re: appraisal of blue mountain lands, the blue mountains ... · chs realty advisors inc. completed...

5859 YONGE STREET, SUITE 104 TORONTO, ON M2M 3V6 CANADA

Toivo Heinsaar

Phone: 416-666-6849

Email: [email protected]

August 3, 2016

Mr. Vadim Shub, CFOSkyline Investment Inc.150 King Street West, Suite 2108Toronto, OntarioCanada M5H 1J9

Re: Appraisal of Blue Mountain Lands, The Blue Mountains, Ontario

Dear Mr. Shub:

CHS Realty Advisors Inc. completed a Narrative Appraisal for future development lands located in The BlueMountains, Ontario. Toivo Heinsaar, AACI, MRICS inspected the property on October13, 2014.The effective dateof the appraisal report is June 30, 2016. The appraisal was prepared for the purpose of substantiation of fairmarket value of the properties for public financial statement preparation in accordance with IFRS purposes andmortgage financing purposes. The undersigned acknowledges that the attached appraisal, dated August 3, 2016,may be used by Skyline Investment Inc., Mishorim Development Group Ltd. and Schwartz Levitsky Feldman LLPGai, Goffer, Yanev, Guilman, Udem and Co., as part of their audit procedure, and as such, we give our consentthat the said appraisal may be attached to any report and/or prospectus which, pursuant to the laws andregulations of the State of Israel, must be publicly filed with said financial statements.

Respectfully submitted,

CHS Realty Advisors Inc.

Toivo Heinsaar, BA, AACI, P.App., MRICSPartnerCHS Realty Advisors [email protected]

APPRAISAL REPORT OF:BLUE MOUNTAIN LANDS, THE BLUE MOUNTAINS, ONTARIO

August 3, 2016

Prepared for:


5859 YONGE STREET, SUITE 104 TORONTO, ON M2M 3V6 CANADA

Toivo Heinsaar

Phone: 416-666-6849

Email: [email protected]

August 3, 2016


Re: Appraisal of Blue Mountain Lands, The Blue Mountains, Ontario

Dear Mr. Shub:

At your request we have prepared an appraisal report of certain lands (described herein) located in The BlueMountains, Ontario (“Subject Properties”). The appraisal will be prepared for the purpose of substantiation offair market value of the properties for public financial statement preparation in accordance with IFRS purposesand mortgage financing purposes. Our analysis is presented in the following Narrative Appraisal Report.

The purpose of this Narrative Valuation Report is to estimate the “as-is” market value of the Fee Simple interestin the Subject Properties as at 30-June-16, subject to the Assumptions and Limiting Conditions outlined withinthis report and Appendices.

This Narrative Valuation Report was prepared in accordance with the Canadian Uniform Standards ofProfessional Appraisal Practices (CUSPAP). It contains an analysis of general and specific data deemed essentialto support the estimate of value reported herein.

This appraisal was prepared for the Mr. Vadim Shub, Skyline Investment Inc. its successors and assigns, and isintended only for its specific use. This appraisal report may be distributed to and relied upon by the Client’sattorneys, auditors, participating lenders and rating agencies. It may not be distributed to or relied upon byother persons or entities without written permission of CHS Realty Advisors and the Appraiser. It is not to bereferred to or quoted in any prospectus for the sale or exchange of securities, and may not be reproduced, inwhole or in part, without our prior written agreement.

2

Blue Mountain Lands, The Blue Mountains, Ontario

A result of this analysis, it is our opinion that the market value of the Fee Simple interest in the SubjectProperties, subject to the assumptions, limiting conditions, certifications and definitions contained herein, as at30-June-16, is estimated as follows:

This estimate of market value is based on an exposure time of 6 to 12 months.


CHS Realty Advisors Inc.


No. Property Estimated Market value

1 Monterra South/Second Nature (South & North Half) $10,815,000

2 Plateau East $2,170,000

3 Monterra Phase 2 $1,970,000

4 Boathouse 3 and 4 Lands $1,575,000

5 Village Core Lands $10,230,000

6 Mountain Walk II $240,000

Total $27,000,000

BLUE MOUNTAIN RESORT DEVELOPMENT LANDS

Toivo

Toivo Heinsaar Signature

TABLE OF CONTENTS 3


TABLE OF CONTENTSTABLE OF CONTENTS........................................................................................................................................... 3

TERMS OF REFERENCE.........................................................................................................................................9

TOWN OF THE BLUE MOUNTAINS ..................................................................................................................... 12

HIGHEST AND BEST USE ANALYSIS................................................................................................................... 18

VALUATION APPROACHES ................................................................................................................................ 19

MONTERRA SOUTH/SECOND NATURE.............................................................................................................. 20

PLATEAU EAST ................................................................................................................................................... 30

MONTERRA PHASE 2 .......................................................................................................................................... 40

BOATHOUSE 3&4................................................................................................................................................ 50

SITE DESCRIPTION.............................................................................................................................................. 52

VILLAGE CORE LANDS........................................................................................................................................ 59

MOUNTAIN WALK II............................................................................................................................................ 70

CERTIFICATION OF APPRAISAL.......................................................................................................................... 76

ADDENDUM.........................................................................................................................................................77

EXECUTIVE SUMMARY 4


PROPERTY SUMMARY

EXECUTIVE SUMMARY 5


REGIONAL MAP

EXECUTIVE SUMMARY 6


NEIGHBOURHOOD MAP

EXECUTIVE SUMMARY 7


EXECUTIVE SUMMARY 8


RESIDENTIAL LANDS

TERMS OF REFERENCE 9


TERMS OF REFERENCEVALUE OPINIONThe value opinion presented in this report is considered to be a current value opinion.

PURPOSE AND INTENDED USE OF THE APPRAISALThe appraisal will be prepared for the purpose of substantiation of fair market value of the properties for publicfinancial statement preparation in accordance with IFRS purposes and mortgage financing purposes. Publicfinancial statement preparation in accordance with IFRS purposes and mortgage financing purposes.

This report has been prepared for the Mr. Vadim Shub, Skyline Investment Inc.

This report is subject to the Assumptions and Limiting Conditions which form Addendum “A” to this report, inaddition to specific assumptions which may be stated in the body of the report.

Note: personal property is not included in the valuation of the Subject Property.

DEFINITION OF MARKET VALUEFor the purposes of this valuation, market value is defined as:

The most probable price which a property should bring in a competitive and open market under all conditionsrequisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price isnot affected by undue stimulus. Implicit in this definition are the consummation of a sale as of the specific dateand the passing of title from seller to buyer under conditions whereby:

• Buyer and seller are typically motivated;• Both parties are well informed or well advised, and acting in what they consider to be in their best

interests;• A reasonable time is allowed for exposure in the open market;• Payment is made in terms of cash in Canadian Dollars or in financial arrangements comparable thereto;

and• The price represents the normal consideration for the property sold unaffected by special or creative

financing or sales concessions granted by anyone associated with the sale.

REASONABLE EXPOSURE TIME ESTIMATEExposure time is always presumed to precede the effective date of the appraisal. It may be defined as:

"The estimated length of time the property interest being appraised would have been offered onthe market prior to the hypothetical consummation of a sale at market value on the effective dateof the appraisal. It is a retrospective estimate based upon an analysis of past events assuming acompetitive and open market."

Ongoing discussions with agents active within the real estate market have indicated that properties such as theSubject typically require a marketing period of at least 6 months, depending on a number of factors includinglocation, condition of the improvements, and motivation of the purchaser/vendor.

It is therefore concluded that for the Subject Property to sell at the market value estimated herein, an exposureperiod of approximately 6 to 12 months would be required.



RELEVANT DATESInspection Date: 13-October-14

Effective Date: 30-June-16

Report Date: 3-August-16

REPORTING STANDARDSThe valuation analysis and the Appraisal conveying the estimate(s) of value have been prepared to comply withAppraisal Standard Rules and Appraisal Standard Comments of the Canadian Uniform Standards of ProfessionalAppraisal Practice (“The Canadian Standards”). As such, all relevant material is provided in this narrative report,including the discussion of appropriate data, reasoning, and analyses that were used in the appraisal process todevelop the opinion of value. Additional supporting documentation concerning the data, reasoning, andanalyses used is retained in the Appraiser’s file. The depth of discussion contained in this report is specific to theneeds of the client and for the intended use stated. The appraiser is not responsible for unauthorized use of thisreport.

ASSUMPTIONS AND LIMITING CONDITIONSCertain assumptions and limiting conditions have been made with respect to the appraisal of the SubjectProperty. These are included in the report’s Addenda as Addendum A.

EXTRAORDINARY LIMITING CONDITIONSAn Extraordinary Limiting Condition refers to a necessary modification or exclusion of an Appraisal InstituteStandard Rule. Such special circumstances include the inability to complete a property inspection, thepurposeful exclusion of relevant valuation technique, etc.

• This appraisal does not employ any hypothetical conditions.

EXTRAORDINARY ASSUMPTIONS & HYPOTHETICAL CONDITIONSAn Extraordinary Assumption is an assumption, which if not true, could alter the appraiser’s opinions andconclusions. They are required when a Hypothetical Condition is necessary due to circumstances that are notself-evident regarding the appraised property. Hypothetical Conditions include retrospective appraisals,significant renovations to the improvements, completion of proposed improvements, etc.

• For the purposes of this report, we have assumed there are no contaminants affecting the site. The sub-soil is assumed to be similar to other lands in the area and suitable in drainage qualities and loadbearing capabilities to support the existing development

SCOPE OF REPORTDuring the course of preparing this valuation, the appraiser:

• Made a physical inspection of the Subject Properties as described herein;• Toured the subject neighbourhood for the purpose of observing land use and general conformity of

development, road patterns and other relevant area data;• Reviewed various documents related to the Subject Properties;



• Researched and analyzed relevant market and financial data of similar properties in the Subject’smarket area;

• Interviewed local area real estate brokers/representatives;• Reviewed available economic and real estate data regarding the local market;• Reviewed and verified current land use regulations (Official Plan and Zoning By-law);• Estimated the Highest and Best Use of the Subject Properties; and• Prepared a narrative valuation report in accordance with the Standards.

Additional supporting documentation concerning the data, reasoning, and analyses is retained in theappraiser’s file. The depth of discussion contained in this report is specific to the needs of the client and for theintended use stated.

MARKET OVERVIEW 12


TOWN OF THE BLUE MOUNTAINSOVERVIEWThe Blue Mountains is a town in Grey County, south-western Ontario, Canada, located where the Beaver River

flows into Nottawasaga Bay. It is named for the Blue Mountain, andhence the economy of the town is centered around tourism,particularly on the Blue Mountain ski resort and the private Craigleithand Alpine Ski Clubs.

The town was formed on January 1, 2001, when the Town of Thornburyand the remaining settlements in the Township of Collingwood wereamalgamated. The Bruce Trail passes through sections of the town.The Kolapore area for mountain biking and cross-country skiing,Metcalfe Rock which is popular with rock climbers as well as theDuncan Crevice Caves Nature Reserve are in the area as well.

DEMOGRAPHICSPOPULATION

Population data for the four South Georgian Bay municipalities is presented below.

Census Population & Percentage Change, 2011

2011 2006 % change 2006-2011 % change2001-2006

Clearview 13,734 14,088 -2.5% 2.1%

Collingwood 19,241 17,290 11.3% 7.8%

The Blue Mountains 6,453 6,825 -5.5% 11.6%

Wasaga Beach 17,537 15,029 16.7% 21.0%

ONTARIO 12,160,282 12,851,821 5.7% 6.6%

Population trends for each of the four municipalities vary over the 2006-2011 period. Clearview has moved froma slight increase in population between 2001 and 2006 to a slight loss of population between 2006 and 2011.Collingwood’s growth rate for 2006-2011 has increased to double-digit percentage figures. This increase isindicative given the development of the Intrawest Blue Mountain Ski Resort and the rapid development ofcondos and new single family housing in The Blue Mountains and Wasaga Beach. The Blue Mountains havedropped from double-digit growth between 2001 and 2006 to a significant population loss between 2006 and2011. While Wasaga Beach’s growth slowed, it nevertheless maintained a considerable double-digit increasebetween 2006 and 2011. With the exception of Clearview, the trends have been somewhat more volatile ascompared to Ontario as a whole.

MARKET OVERVIEW 13


AGE PROFILE

Age Distributions by Broad Age Groups and Sex, 2011 Census

Age Groups Both Sexes Males Females

0 to 14 10.9% 11.4% 10.5%

15 to 64 60.5% 59.3% 61.7%

65 and over 28.5% 29.3% 27.8%

In 2011, the percentage of the population aged 65 and over in The Blue Mountains was 28.5%, compared with anational percentage of 14.8%. The percentage of the working age population (15 to 64) was 60.5% and thepercentage of children aged 0 to 14 was 10.9%. In comparison, the national percentages were 68.5% for thepopulation aged 15 to 64 and 16.7% for the population aged 0 to 14. It’s clear from these statistics that thetarget market is strongly biased toward empty nesters and retirees.

INDUSTRYThe chart below highlights this data by selected industry sectors. In Wasaga Beach, the low level of full-time full-year work is especially pronounced in the Retail Trade and Food & Accommodation Services industries,reflecting the greater seasonality of the tourism sector in that area. In The Blue Mountains the incidence of lowfull-time full-year work is especially noticeable in the Professional, Scientific & Technical Services and the Health& Social Assistance sectors, reflecting perhaps a higher proportion of semi-retired professionals working part-time.

PE R C E N T A G E FU L L -T I M E , FU L L -YE A R , EM P L O Y M E N T , SE L E C T IN D U S T R I E S , 2006

MARKET OVERVIEW 14


EMPLOYMENT INCOME

The chart below compares the percentage of jobs by annual income, dividing them into three income ranges.

EM P L O Y M E N T I N C O M E F O R JO B S IN M A R K E T AR E A S , 2005

All four communities have a higher proportion of jobs whose annual employment income was under $20,000 in2005. This is particularly the case for Wasaga Beach, where 41% of jobs fell under $20,000, reflecting the higherproportion of jobs that are seasonal and/or part-time (Clearview is not far off at 35%). At the other end of thescale, all four communities also exhibited a smaller proportion of jobs with higher incomes (above $60,000)compared with the figure for Toronto or the rest of Ontario. The Blue Mountains had a significant portion of jobswith annual incomes falling between $20,000 and $60,000.

RESALE MARKET OVERVIEW

LISTINGS

According to the MLS statistics released by the Georgian Triangle Association of Realtors (“GTAR”), the upwardtrend of new residential listings in June 2016 was 592 units, up 2.2 percent from a year earlier. Overall, thesupply remains the lowest in more than a decade. There were 1,095 active residential listings on the MLS systemat the end of June 2016, down 37.2 percent from levels a-year-ago.

SALES

Sales have been increasing over the past number of years. The general consensus is that the strong GTA housingmarket is also fueling demand in the Georgian Triangle Real Estate Market. Residential sales came in well abovea year ago home levels in June 2016. Home sales have numbered 444 units in June 2016, rising 19 percent froma year ago. The areas include The Blue Mountain and Collingwood with the increase of 19.1 percent year-over-year basis to 287 units in June 2016. The history of sale trends displays the increase overtime. While the BlueMountains market has always remained somewhat weaker as compared to Collingwood, both markets areexperiencing a relatively strong upward trend in sales over the past few years.

MARKET OVERVIEW 15


DEMAND AND SUPPLY

Sales-to-listings ratio are up considerably from 2015 and at the same time expired listings are down. This

combination of higher sales-to-listing ratios and fewer expired listings also indicates a big demand for new

listings. The table below highlights the activity in the market year-over-year.

MARKET OVERVIEW 16


SOUTHERN GEORGIAN BAY ASSOCIATION OF REALTORS1

The most recent new release from the Southern Georgian Bay Association of Realtors is quoted below:

“Residential sales recorded through the MLS® System of the Southern Georgian Bay Association of REALTORS® camein well above year-ago levels in June 2016.

Home sales numbered 444 units in June 2016, rising 19 per cent from a year earlier.

The Southern Georgian Bay Association of REALTORS® comprises two distinctive markets. Home sales in theWestern Region which includes Wasaga Beach, Springwater, Clearview Township, Collingwood, The BlueMountains, Municipality of Meaford and Grey Highlands rose 19.1 per cent on a year-over-year basis to 287 units inJune 2016.

Home sales in the Eastern Region, encompassing the Towns of Midland and Penetanguishene, and the Townshipsof Georgian Bay, Severn, Oro-Medonte, Tay and Tiny totaled 157 units in June. This was an increase of 18.9 per centfrom June 2015.

On a year-to-date basis home sales totaled 1,876 units over the first half of the year, rising 25.6 per cent from thesame period in 2015.

Year-to-date sales in the Western Region were up 21.4 per cent from 2015. Activity over the first half of 2016recorded a gain of 34.2 per cent year-over-year in the Eastern Region.

“June 2016 saw more residential properties trade hands in the region served by the Association than in any othermonth in history, breaking the previous record set the month before,” said Kevin Woolham, President of theSouthern Georgian Bay Association of REALTORS®. “While the overall stock of listings relative to demand is currentlysitting at unprecedented lows, there has been some relief in the form of a solid rebound in new listings in theWestern District.”

The number of new residential listings in June 2016 was 592 units, up 2.2 per cent from a year earlier.

1 Southern Georgian Bay Association of Realtors

MARKET OVERVIEW 17


Overall supply remains at the lowest levels in more than a decade. There were 1,095 active residential listings onthe Association’s MLS® System at the end of June 2016, down 37.2 per cent from year-ago levels.

There were just 2.5 months of inventory at the end of June, down from the 4.7 months recorded at the end of June2015 and well below the long-run average for this time of year. The number of months of inventory is the number ofmonths it would take to sell current inventories at the current rate of sales activity.

The value of all residential transactions in June was $150.1 million – the first time that the monthly dollar volumehas ever surpassed the $150 million mark.

Sales of all types of properties numbered 484 units in June, an increase of 13.1 per cent compared to the samemonth in 2015. The total value of all properties sold in June 2016 was $162.7 million, up 30 per cent from June2015.”

CONCLUDING COMMENTS

The four municipalities in the region each have very different economic characteristics, but represent a singlelabour market. Tourism is the dominant industry driving growth in all sectors of the regional economy andcontinues to be the fastest growing industry in the region.

The economy of The Blue Mountains is dominated by theIntrawest Blue Mountain Ski Resort depicted in this imagefrom Google Earth. It is the largest ski resort in Ontario.Beginning in 1999 when Intrawest acquired 50% ownership ofthe property from the Weider family, the resort has undergonea major expansion: 1,000 condo-hotel units including theGrand Georgian Hotel with its 131 suites, 200 town homes and100,000 sq. ft. of commercial space and a conference centre.

The land use function of the Blue Mountain Village as prescribed in the Official Plan is to serve as one of the threemain commercial nodes within the Town and, provide accommodations for visitors, guests and tourists. Inparticular, the Plan states that “the predominant use of land shall be for residential. Recreational andcommercial uses intended to both complement the existing recreational base and enhance the development ofyear-round recreational opportunities and facilities” (S.4.8). The residential component is subject to specificzoning By-law regulations limiting owner occupancy thus encouraging the availability of “pooled” condominiumhotel units. The Blue Mountain Village Core land use designation is unique in purpose, permitted uses andrestrictions on those permitted uses.

The Town of Collingwood is the commercial and service centre for the entire region. It accounts forapproximately half of all business activity including retail sales in the region and has a substantial health,manufacturing, financial and knowledge-based employment foundation. Collingwood benefits from thesurrounding visitor attractions and has a strong base of accommodation and food businesses. There are morethan 20,000 jobs available in the region and more than half of those (54.6%) are found in Collingwood.Collingwood is the location of the Regional Hospital and a wide range of other personal and business services.

HIGHEST AND BEST USE ANALYSIS 18


HIGHEST AND BEST USE ANALYSISINTRODUCTIONThe principal of the “Highest and Best Use” of a property is fundamental to the concept of market value. Highestand Best Use is defined by the Appraisal Institute of Canada as:

“The reasonably probable and legal use of vacant land or an improved property; which is physically possible,appropriately supported, financially feasible, and that results in the highest value. The four criteria the highestand best use must meet are legal permissibility, physical possibility, financial feasibility, and maximumprofitability.”

PHYSICALLY POSSIBLE

The Subject Properties are adequately served by utilities, and have adequate shape and size, sufficient access,etc., to be separately developable sites. There are no known physical reasons why the Subject Sites would notsupport any legally probable development. The surrounding development in the general area providesadditional evidence for the physical possibility of development for the various sites and proposed uses.

LEGALLY PERMISSIBLE

The legally permissible uses are discussed in the property specific zoning sections. The proposed uses aresupported by the zoning by-laws in place or as rezoned.

FINANCIALLY FEASIBLE

The determination of financial feasibility is dependent primarily on the relationship of supply and demand forthe legally probable land uses versus the cost to create the uses. As discussed in the market analysis of thisreport, development (commercial/residential) in the market is healthy. Development of residential subdivisionsand commercial developments in Blue Mountain Village are ongoing and as such, indicate that it would befinancially feasible to complete a new residential/commercial development.

MAXIMALLY PRODUCTIVE

The final determination in the highest and best use analysis is the maximally productive use of the site. Land usein the area consists of a range of residential and commercial uses. Based upon market evidence of area uses, it isreasonable to conclude that the proposed uses would represent a maximally productive use.

HIGHEST AND BEST USE CONCLUSIONBased on the information presented above and upon information contained in the market and neighborhoodanalysis, we conclude that the highest and best use of the Subject Properties would be development asproposed for each property analyzed in this report.

VALUATION APPROACHES 19


VALUATION APPROACHESINTRODUCTIONThe market value of the subject property is contingent upon a number of factors such as location, replacementcost, physical condition and utility of the improvements, the market climate and general economic conditions.In the valuation process, these factors are incorporated into several approaches to value. The selection of therelevant methodology depends on the characteristics of the real estate being analyzed.

Traditionally, the three most common approaches to the valuation of real property are:

The Cost Approach to value is based on the economic principle of substitution, which states that the value of aproperty should not be more than the amount by which one can develop (by purchase of a site and constructionof a building without undue delay) a property of equal desirability and utility.

The Direct Comparison Approach considers the cost of acquiring equally desirable and valuable substituteproperties, indicated by transactions of comparable properties, within the market area. The characteristics ofthe sale properties are compared to the subject property on the basis of time and such features as location, sizeand quality of improvements, design features and income generating potential of the property.

The Income Approach to value is used to estimate real estate value based on property income generatingcapabilities using the Direct Capitalization Method or the Discounted Cash Flow method.

There are two traditional methods to income valuations.

• Direct Capitalization Method – division of a required yield (inverse of a required income multiple) intoNet Operating Income to yield a value.

• Discounted Cash Flow Method - accounts for the anticipated growth or decline in income over the termof a prescribed holding period.

VALUATION SOLUTIONWith the exception of the Boathouse 3 & 4 lands (where the Income Approach - Land Residual Methodology isdeveloped), the Direct Comparison Approach will be developed.

DIRECT COMPARISON APPROACH - UNIT OF COMPARISON RATIONALE

There are two basic units of comparison: density units and physical units. Zoning ordinances relate to the firstand the latter relates to physical measures, either linear or square units. Typically, density unit comparison maybe appropriate where there is an active market and where there is a relatively straightforward low density formof development proposed (for example, if the land is already developed or if it is a greenfield within an urbaneconomy and where infrastructure costs are consistent and not excessive). In this case, it is likely that thedensity, form and unit cost of the development will be similar with other comparables chosen for analysis. Itmay be tempting to break sale prices down into productive units for analytical purposes such as dollars perhotel unit or townhome unit. Such property uses are typically not zoned on this basis. Instead they arezoned according to building setback requirements, height limitations, site coverage ratio, or floor arearatio. The preliminary development nature of the subject lands under analysis and a somewhat inactive ruralmarket would suggest a comparison unit related to zoning ordinances as opposed to density units, which alsovary greatly in size from site to site. In this instance, the market will not use such price units, but ratherdevelop values utilizing more conventional and readily understood units such as price per acre.

MONTERRA SOUTH/SECOND NATURE 20

20 Blue Mountain Lands, The Blue Mountains, Ontario

MONTERRA SOUTH/SECOND NATUREADDRESS OF PROPERTY UNDER VALUATIONGrey Road 19, The Blue Mountains, Grey, Ontario

LEGAL DESCRIPTIONPIN 37147-0005(LT): CON 1 S PT LOT 17 RP 16R3145 PART 1 CON 1 PT LOTS 17&18 RP 16R5057 PART 5 PART 3, PLAN 16R-7246 PART 17, PLAN 16R-3495

PROPERTY IDENTIFICATION NUMBER (PIN)371470234

OWNERSHIP AND HISTORYThe ownership history of the Subject Property is summarized in the following table:

PARCEL ID DATE INST. TYPE FROM TO

371470234 15-April-13 Transfer - T The Corporation of the Town of The BlueMountains Skyline Blue Mountain Development Inc.

There is currently a conditional Agreement of Purchase and Sale for the Subject Property dated March 3, 2016. Thepurchase price is $11,500,000.

SUBJECT PROPERTY USECURRENT USE

Residential Development Land

PROPOSED USE

151 Single Family Lots and 82 Townhouse Units

ENCUMBRANCESWe do not know of any easements that would adversely affect the site's use. If the reader has specific concerns or desiresadditional support, we recommend a title search and consultation with a real estate attorney to determine whether anyadverse conditions exist.



LAND USE ANALYSISLand use in Ontario may be controlled or directed by provincial restrictions through legislation such as the Planning Act,the Planning and Development Act, etc. Land use is also controlled by municipal restrictions such as Official Plans andZoning By-Laws and/or other restrictive By-Laws.

OFFICIAL PLAN

According to the current Official Plan, the Subject Property is designated PR-28, H- Primary Residential and Hazard.

Residential development may include a range of housing types from single detached to low rise multiple units. It isintended to accommodate the majority of the new recreational base that will occur over the planning period. Themaximum density is 10 units per hectare and the open space component is 10% of the overall development. Increaseddensities not exceeding a total of 15 units per hectare on the basis that additional recreational lands and or facilities areto be provided that additional recreational lands are to be provided to the satisfaction of Council.

ZONING BY-LAW

According to the current Zoning By-Laws, the Subject Property is designated R3-Residential, R6-Residential, OS1-OpenSpace, OS2-Open Space, (H)-Hold.

Draft plan approval in place for 151 single family lots and 82 townhouse units.

PROPERTY ASSESSMENTThe property assessment data is summarized in the table below:

PROPERTY ASSESSMENT DATA

Roll Number: Monterra South / Second Nature Part 1: 424200000300100Monterra South / Second Nature Part 1: 424200000300400

MPAC Property Code & Description: 424200000300100: 125 - Residential development land424200000300400: 125 - Residential development land

Current Value Assessment:424200000300100: $5,723,000424200000300400: $4,638,000Total: $10,361,000



SITE DESCRIPTION

GENERAL

Location: Grey Road 19 and Mountain Drive

Configuration: Irregular

Corner Influence: Yes Traffic Pattern: Light

Site Area: 90.12 ac. (3,925,627sf)

Current Use: Vacant development lands

Proposed Use: 151 Single Family Lots and 82 Townhouse Units

Development Stage: Draft Plan Approval in place

Development Timeline: 1-2 Years

SITE IMAGE

SITE RATING

Utility Rating: Good Large parcel with potential for multiple access points.

Location Rating: Good In close proximity to Blue Mountain Village and all recreational amenities

Overall Rating: GoodAttractive residential development given it locational and physical attributes.



DESCRIPTION

Services Summary: Full Municipal Services Available

Access: Direct access to Subject Street

Topography: Gently sloping lands - no significant topographical constraints

Landscaping: None

Floodplain: The Subject Property is not known to be located within a floodplain.

Surface Drainage: No surface drainage issues noted

Sub Surface Conditions: No sub surface issues note. Assume sub surface conditions are similar to surrounding sites.

Environmental:We observed no evidence of toxic or hazardous substances during our inspection of the site, however,we are not trained to perform technical environmental inspections. Should concerns exist, werecommend the hiring of a professional engineer with expertise in this field.

SITE & STREET IMPROVEMENTS

Street Lights: No Sidewalks: No

Curb/Gutter: Available Street Surface: Asphalt

Street Width: 2 Lanes Sewers: Available Nearby

Storms: Available Ditches: Yes

Municipal Water: Available Well: No

Septic: No Hydro: Available

Gas: Available Telephone: Available

Comments: The Subject Property is a relatively large undeveloped parcel of land across the street from BlueMountain Village. The property features a greenbelt running diagonally through the mid-section with awatercourse. The proposed project is split into 4 phases (single detached) and an 82 multi-unitcomponent in the southwest corner.



DIRECT COMPARISON APPROACHINTRODUCTION

The Direct Comparison Approach is based on the Principle of Substitution which maintains that a prudent purchaserwould not pay more for a property than the cost to purchase a suitable alternative property which exhibits similarphysical characteristics, tenancy, location, etc.

Within this approach, the property being valued is compared to properties that have sold recently or are currently listedand are considered to be relatively similar to the subject property. Typically, a unit of comparison (i.e. sale price persquare foot) is used to facilitate the analysis.

In the case of properties similar to the subject, the sale price per acre is the most commonly used unit of comparison.

SELECTION OF COMPARABLE SALES

As one sale is not necessarily indicative of market value, an appraiser examines a number of market transactions. Whenproperly reconciled, trends emerge, leading to the estimate of market value of the property being appraised.

The sales selected are considered to provide the most reliable evidence of market value for the Subject Property. Thesearch yielded 5 sales which were considered to be similar to the Subject Property. The sale prices ranged from$3,109,210 to $10,000,000 – an average of $5,850,000. When converted to a sale price per acre, the prices ranged from$80,409 to $136,700 – an average of $100,265.

Index Address Municipality Region Property Type Site Area Ac Sale Date Sale Price Sale Rate1349 3278 4th Line Bradford West Gwillimbury Simcoe Land 102.6 24-Sep-14 $8,250,000 $80,4091350 2944 5th Line Bradford West Gwillimbury Simcoe Land 100.24 7-Aug-14 $10,000,000 $99,7611351 343 Town Line Barrie Simcoe Land 31.01 1-May-14 $3,109,210 $100,2651364 2572 10th Sideroad Bradford West Gwillimbury Simcoe Land 31.09 30-Apr-15 $4,250,000 $136,7003085 260 Mountain Road Collingwood Simcoe Land 48.98 15-Jan-16 $5,850,000 $119,437

Minimum 31.01 1-May-14 $3,109,210 $80,409Maximum 102.6 15-Jan-16 $10,000,000 $136,700Median 48.98 24-Sep-14 $5,850,000 $100,265

Comparable Sales Table



COMPARABLE SALES MAP



ADJUSTMENT CONSIDERATIONS

In valuing the subject lands, comparison was made to each of the index sales. The basis for comparison included theconsideration of the following criteria listed below.

ADJUSTMENT ITEMS

Sale Date Where the market is changing, it may be necessary to adjust prices to reflect the time difference between the dateof sale of a comparable property and the date of valuation.

Rights Conveyed When real property rights are sold, they may be the sole subject of the contract or the contract may include otherrights. In the sales comparison analysis, it is pertinent that the property rights of the comparable sale be similar tothe property rights of the subject property. All the sales considered were Fee Simple transfers, no adjustmentswere necessary.

Financing The transaction price of one property may differ from that of a similar property due to different financingarrangements. Financing arrangements may include existing mortgages at favourable interest rates or payingcash to a lender so that a mortgage with a below-market interest rate could be offered.

Conditions of Sale Adjustments for conditions of sale usually reflect the motivations of the purchaser and vendor. In some cases, theconditions of sale significantly affect transaction prices. Sales that reflect unusual situations require anappropriate adjustment for motivation or sale condition. For example, power-of-sale conditions involve a certaindegree of urgency on part of the lender - leading to a somewhat lower sale price than what would otherwise beexpected. On the other hand, transactions to create a land assembly may result in higher motivation by the buyerwhich often leads to a higher sale price than would be expected.

Location An adjustment for location within a market area may be required when the locational characteristics of acomparable property are different from those of the subject property. Excessive locational differences maydisqualify a property from use as a comparable. Although no location is inherently desirable or undesirable, themarket recognizes that one location is better than, similar to, or worse than another.

Site Utility Site utility adjustments take into account site grading, site size, configuration and other factors that may haveimpact upon development. Site grading enhances utility and is considered as a value added feature. As site sizedecreases, certain types of development can become problematic from the standpoint of physical and financialfeasibility. A site size that allows for more flexibility in development is favoured over a smaller more restrictivesite. The configuration of the site will have impact upon maximum usable area of the site. Oddly configured sitestend to have more leakage of usable land.

Development Status The development status (i.e. Draft Plan Approved) of a property has a material impact upon the value of aproperty. Consideration is given for properties which differ significantly in development status.

Site Area AC The price per acre of land is expected to vary with the size of the tract. Generally, above an optimum acreage, assize increases, the price per acre decreases where all other features are similar. This is typically referred to asmarginal diminishing utility.

ANALYSIS OF COMPARABLE SALES

The search yielded 5 sales considered similar to the Subject Property. It is acknowledged that sellers and buyers do notactually apply plus or minus adjustments by percentage or by lump sum dollar amounts for individual differencesbetween comparable properties and a Subject Property. They do, however, weigh the advantages and disadvantages of aproperty they may sell or buy compared to others which have sold or are listed, and make at least an overall adjustmentto reflect all of the differences. Descriptive analyses of the sales are outlined on the following pages.

Index 1349 - 3278 4th Line (Bradford West Gwillimbury) was purchased for $8,250,000 ($80,409 per acre) in 2014-09-24. The property rights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale isconsidered arms-length. This sale represents a farm and future development land. It is located just east of Highway 400and north of the Holland Marsh. This property was purchased together with 3203 Fifth Line (91.1 acres) for a total



consideration of $16,500,000. Upward adjustments were made for Sale Date, Location, Development Status and SiteArea Ac. Downward adjustments were made for Site Utility. Adjustments were not required for Property Rights,Financing, Conditions of Sale or Development Density. This sale required a total net upward adjustment - indicating a netadjusted rate of $111,000 per acre.

Index 1350 - 2944 5th Line (Bradford West Gwillimbury) was purchased for $10,000,000 ($99,761 per acre) in 2014-08-07. The property rights conveyed were fee simple and financing was reportedly provided by the vendor - the sale isconsidered arms-length. This farm and future development land is located on the north side of 5th Line and adjacent tothe Highlands Golf Club and residential development along Brownlee Drive. It is also a short distance south east of theHighway 400 interchange at County Road 88. It was last transferred in December 2010 for $6,600,000. Upwardadjustments were made for Sale Date, Development Status and Site Area Ac. Downward adjustments were made forLocation and Site Utility. Adjustments were not required for Property Rights, Financing, Conditions of Sale orDevelopment Density. This sale required a total net upward adjustment - indicating a net adjusted rate of $121,000 peracre.

Index 1351 - 343 Town Line (Barrie) was purchased for $3,109,210 ($100,265 per acre) in 2014-05-01. The propertyrights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale is considered arms-length. Sale of Pine View Golf & Country Club - about 31.0 Ac @ $100,265. For development of a subdivision of detachedsingle family homes. It is currently under construction - Pineview Greens is a new single family home development byRoyalpark Homes. Upward adjustments were made for Sale Date. Downward adjustments were made for Location andSite Area Ac. Adjustments were not required for Property Rights, Financing, Conditions of Sale, Site Utility, DevelopmentStatus or Development Density. This sale required a total net downward adjustment - indicating a net adjusted rate of$96,000 per acre.

Index 1364 - 2572 10th Sideroad (Bradford West Gwillimbury) was purchased for $4,250,000 ($136,700 per acre) in2015-04-30. The property rights conveyed were fee simple and financing was reportedly provided by the vendor - thesale is considered arms-length. The site is located across the street from the built-up area of Bradford West Gwillimbury -consisting of new residential development. The farm property is currently leased to a farmer. The purchaser hopes todevelop the property (in 1-3 years) for residential use. Upward adjustments were made for Sale Date and DevelopmentStatus. Downward adjustments were made for Location, Site Utility and Site Area Ac. Adjustments were not required forProperty Rights, Financing, Conditions of Sale or Development Density. This sale required a total net downwardadjustment - indicating a net adjusted rate of $126,000 per acre.

Index 3085 - 260 Mountain Road (Collingwood) was purchased for $5,850,000 ($120,000 per acre) in 2016-01-15.The property rights conveyed were fee simple and financing was reportedly provided by the vendor - the sale isconsidered arms-length. This site is located between Mountain Road and Blue Mountain Golf and Country Club. The sitehas frontage along Mountain Road and 10th Line. It is currently an agricultural field. Draft Approved Land inCollingwood's west end allows for a mix of singles, towns, and walk-up units at this time up to 304 units total. Also with acommercial element. Zoned REC EP R3-42 R3 C6. Upward adjustments were made for Sale Date. Downwardadjustments were made for Site Utility and Site Area Ac. Adjustments were not required for Property Rights, Financing,Conditions of Sale, Location, Development Status or Development Density. This sale required a total net downwardadjustment - indicating a net adjusted rate of $119,000 per acre.



ADJUSTMENT SUMMARY TABLE

Adjustment Summary Table

Property Description Subject Property Index 1349 Index 1350 Index 1351 Index 1364 Index 3085

Address/LegalDescription

Monterra South/SecondNature 3278 4th Line 2944 5th Line 343 Town Line 2572 10th Sideroad 260 Mountain

Road

City Town of The Blue Mountains Bradford WestGwillimbury

Bradford WestGwillimbury Barrie Bradford West

Gwillimbury Collingwood

Sale Date Effective Date 09-24-14 08-07-14 05-01-14 04-30-15 01-15-16

Land Area 90 103 100 31 31 49

Sale Price $10,814,400 $8,250,000 $10,000,000 $3,109,210 $4,250,000 $5,850,000

Sale Rate $120,000 $80,409 $99,761 $100,265 $136,700 $119,437

Value Adjustments Description Description Adj. Description Adj. Description

Adj. Description Adj. Description Adj

.

Market Condition (Time) Effective Date 2014-09-24 + 2014-08-07 + 2014-05-01 + 2015-04-30 + 2016-01-15 +

Property RightsConveyed Fee Simple Fee Simple Nil Fee Simple Nil Fee Simple Nil Fee Simple Nil Fee Simple Nil

Financing Cash Cash Nil VTB Nil Cash Nil VTB Nil VTB Nil

Conditions of Sale Normal Normal Nil Normal Nil Normal Nil Normal Nil Normal Nil

Location Good Avg (+) + Good (+) - Good (+) - Good (+) - Good Nil

Site Utility Avg Good - Good - Avg Nil Good - Good -

Development Status Good Fair + Fair + Good Nil Avg (+) + Good Nil

Site Area Ac 90.12 102.6 + 100.24 + 31.01 - 31.09 - 48.98 -

Total Net Adjustments + + - - -

Adjusted Rate $111,000.00 $121,000.00 $96,000.00 $126,000.00 $119,000.00

MONTERRA SOUTH/SECOND NATURE


MARKET VALUE ESTIMATE

Before the adjustment process, the sale prices ranged from $3,109,210 to $10,000,000 – an average of $5,850,000. Whenconverted to a sale price per acre, the prices ranged from $80,409 to $136,700 – an average of $100,265. After theadjustment process, the sale rates ranged from $96,000 to $126,000.

All factors considered it is our opinion that the market value of the Subject Property via the Direct Comparison Approachas at 30-June-16, is:

90.12 acres x $120,000 per acre = $10,814,400

$10,815,000 (Rounded)

PREVIOUS APPRAISAL DISCLOSURE AND COMMENTS

The Subject Property was appraised for $9,500,000 effective 30-June-15. The current valuation of $10,815,000 containedin this report implies a percentage increase of 14%. The increase in value is considered reasonable when the favourablemarket conditions and escalating prices are taken into consideration.

PLATEAU EAST 30


PLATEAU EASTADDRESS OF PROPERTY UNDER VALUATION220 Grey Road 21, The Blue Mountains, Grey, Ontario

LEGAL DESCRIPTIONPIN 38147-0235(LT): CON 1 N PT LOT 17 RP 16R5057 PARTS 6, 7, 8 PART 22, PLAN 16R-3495




371470235 15-April-13 Transfer - T Westbrook DevelopmentCorporation

Skyline Blue MountainDevelopment Inc.

The Subject Property was sold in late 2015 at an undisclosed price – closing is expected in the latter half of 2016.



PROPOSED USE

37 Single Family Lots



OFFICIAL PLAN

According to the current Official Plan, the Subject Property is designated RR-51-Recreational Residential.

PLATEAU EAST 31


Residential development is intended to be primarily for single detached form however, other housing types includeduplex or town housing developments may be permitted. Residential density shall not exceed 2.5 units per hectare andmust satisfy 40% of the lands comprise a recreational open space component.

ZONING BY-LAW

According to the current Zoning By-Laws, the Subject Property is designated R3-Residential, OS1-Open Space.

Currently draft plan approved for 37 single family lots.



Roll Number: 424200000300300

MPAC Property Code & Description: 125 - Residential development land

Current Value Assessment: $1,806,000

PLATEAU EAST 32


SITE DESCRIPTION

GENERAL

Location: Grey Road 21 and Mountain Road


Corner Influence: No Traffic Pattern: Light

Site Area: 16.09 ac. (700,880sf)

Current Use: Vacant development lands.

Proposed Use: 37 Single Family Lots



SITE IMAGE

SITE RATING

Utility Rating: Good Large parcel with direct access from Grey Road 21.

Location Rating: Good In close proximity to Blue Mountain Village and all recreationalamenities.

Overall Rating: GoodAttractive residential development given it locational and physicalattributes.

PLATEAU EAST 33


DESCRIPTION



Topography: Flat table land

Landscaping: None








Street Width: 2 Lanes Sewers: Available





Comments:

The Subject Property is relatively long strip of undeveloped residential land. The sale calls for 39 lotson a cul-de-sac configuration. The land is currently under going servicing. NOTE: The valuationreported herein does not factor in the servicing and represents unserviced land only.

PLATEAU EAST 34









Index Address Municipality Region Property Type Site Area Ac Sale Date Sale Price Sale Rate1351 343 Town Line Barrie Simcoe Land 31.01 1-May-14 $3,109,210 $100,2651364 2572 10th Sideroad Bradford West Gwillimbury Simcoe Land 31.09 30-Apr-15 $4,250,000 $136,7003085 260 Mountain Road Collingwood Simcoe Land 48.98 15-Jan-16 $5,850,000 $119,437

Minimum 31.01 1-May-14 $3,109,210 $100,265Maximum 48.98 15-Jan-16 $5,850,000 $136,700Median 31.09 30-Apr-15 $4,250,000 $119,437


PLATEAU EAST 35



PLATEAU EAST 36




ADJUSTMENT ITEMS

Date of Sale Where the market is changing, it may be necessary to adjust prices to reflect the time difference between thedate of sale of a comparable property and the date of valuation.

Rights Conveyed When real property rights are sold, they may be the sole subject of the contract or the contract may includeother rights. In the sales comparison analysis, it is pertinent that the property rights of the comparable sale besimilar to the property rights of the subject property. All the sales considered were Fee Simple transfers, noadjustments were necessary.


Conditions of Sale Adjustments for conditions of sale usually reflect the motivations of the purchaser and vendor. In some cases,the conditions of sale significantly affect transaction prices. Sales that reflect unusual situations require anappropriate adjustment for motivation or sale condition. For example, power-of-sale conditions involve acertain degree of urgency on part of the lender - leading to a somewhat lower sale price than what wouldotherwise be expected. On the other hand, transactions to create a land assembly may result in highermotivation by the buyer which often leads to a higher sale price than would be expected.


Site Utility Site utility adjustments take into account site grading, site size, configuration and other factors that may haveimpact upon development. Site grading enhances utility and is considered as a value added feature. As site sizedecreases, certain types of development can become problematic from the standpoint of physical and financialfeasibility. A site size that allows for more flexibility in development is favoured over a smaller more restrictivesite. The configuration of the site will have impact upon maximum usable area of the site. Oddly configuredsites tend to have more leakage of usable land.





Index 1351 - 343 Town Line (Barrie) was purchased for $3,109,210 ($100,265 per acre) in 2014-05-01. The propertyrights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale is considered arms-length. This is the sale of Pine View Golf & Country Club - about 31.0 Ac @ $100,265. It is intended for the development ofa subdivision of detached single family homes. It is currently under construction - Pineview Greens is a new single familyhome development by Royalpark Homes. Upward adjustments were made for Sale Date, Development Status and Site

PLATEAU EAST 37


Area Ac. Downward adjustments were made for Location. Adjustments were not required for Property Rights, Financing,Conditions of Sale, Site Utility or Development Density. This sale required a total net upward adjustment - indicating anet adjusted rate of $118,000 per acre.

Index 1364 - 2572 10th Sideroad (Bradford West Gwillimbury) was purchased for $4,250,000 ($136,700 per acre) in2015-04-30. The property rights conveyed were fee simple and financing was reportedly provided by the vendor - thesale is considered arms-length. The site is located across the street from the built-up area of Bradford West Gwillimbury -consisting of new residential development. The farm property is currently leased to a farmer. The purchaser hopes todevelop the property (in 1-3 years) for residential use. Upward adjustments were made for Sale Date, DevelopmentStatus and Site Area Ac. Downward adjustments were made for Location and Site Utility. Adjustments were not requiredfor Property Rights, Financing, Conditions of Sale or Development Density. This sale required a total net upwardadjustment - indicating a net adjusted rate of $150,000 per acre.

Index 3085 - 260 Mountain Road (Collingwood) was purchased for $5,850,000 ($119,437 per acre) in 2016-01-15.The property rights conveyed were fee simple and financing was reportedly provided by the vendor - the sale isconsidered arms-length. This site is located between Mountain Road and Blue Mountain Golf and Country Club. The sitehas frontage along Mountain Road and 10th Line. It is currently an agricultural field. Draft Approved Land inCollingwood's west end allows for a mix of singles, towns, and walk-up units at this time up to 304 units total. Also with acommercial element. Zoned REC EP R3-42 R3 C6. Upward adjustments were made for Sale Date, Development Statusand Site Area Ac. Downward adjustments were made for Site Utility. Adjustments were not required for Property Rights,Financing, Conditions of Sale, Location or Development Density. This sale required a total net upward adjustment -indicating a net adjusted rate of $137,000 per acre.

PLATEAU EAST 38




Property Description Subject Property Index 1351 Index 1364 Index 3085

Address/Legal Description Plateau East 343 Town Line 2572 10th Sideroad 260 Mountain Road

City Town of The Blue Mountains Barrie Bradford West Gwillimbury Collingwood

Sale Date Effective Date 05-01-14 04-30-15 01-15-16

Land Area 16 31 31 49

Sale Price - $3,109,210 $4,250,000 $5,850,000

Sale Rate - $100,265 $136,700 $119,437

Value Adjustments Description Description Adj. Description Adj. Description Adj.

Market Condition (Time) Effective Date 14-05-01 + 15-04-30 + 16-01-15 +

Property Rights Conveyed Fee Simple Fee Simple Nil Fee Simple Nil Fee Simple Nil

Financing Cash Cash Nil VTB Nil VTB Nil

Conditions of Sale Normal Normal Nil Normal Nil Normal Nil

Location Good Good (+) - Good (+) - Good Nil

Site Utility Avg Avg Nil Good - Good -

Development Status Good Good + Avg (+) + Good +

Site Area Ac 16 31.01 + 31.09 + 48.98 +

Total Net Adjustments + + +

Adjusted Rate $118,000.00 $150,000.00 $137,000.00

PLATEAU EAST 39





16.09 acres x $135,000 per acre = $2,172,150

$2,170,000(Rounded)



MONTERRA PHASE 2 40


MONTERRA PHASE 2ADDRESS OF PROPERTY UNDER VALUATIONGrey Road 21/Grand Cypress Blvd/Augusta Blvd., The Blue Mountains, Grey, Ontario

LEGAL DESCRIPTIONPIN 37147-0222(LT) CON 1 PT LOT 18 RP 16R8591 PART 1




371470222 15-April-13 Transfer - T Westbrook Development Corporation Skyline Blue Mountain Development Inc.



PROPOSED USE

24 Single Family Lots and 28 Townhouse Lots


MONTERRA PHASE 2 41



OFFICIAL PLAN

According to the current Official Plan, the Subject Property is designated RR-28- Recreation Residential.

Residential development is intended to be primarily for single detached form however, other housing types includeduplex or town housing developments may be permitted. Residential density shall not exceed 2.5 units per hectare andmust satisfy 40% of the lands comprise a recreational open space component.

ZONING BY-LAW

According to the current Zoning By-Laws, the Subject Property is designated R3-90-89-Residential, OS2-Open Space.

Draft plan approved for 24 single family lots and 28 townhouse lots.



Roll Number: 424200000300301



MONTERRA PHASE 2 42


SITE DESCRIPTION

GENERAL

Location: Grey Road 21/Grand Cypress Blvd/Augusta Blvd.



Site Area: 14.58 ac. (635,105sf)

Current Use: Vacant development lands.

Proposed Use: 24 Single Family Lots and 28 Townhouse Units



SITE IMAGE

SITE RATING

Utility Rating: Good Large parcel with direct access from Grey Road 21.

Location Rating: GoodIn close proximity to Blue Mountain Village and all recreationalamenities.

Overall Rating: Good

Attractive residential development given it locational and physicalattributes.

MONTERRA PHASE 2 43


SITE DESCRIPTION




Landscaping: None













Comments: The Subject Property is a corner parcel of undeveloped residential land located a short distance fromBlue Mountain Village. The layout calls for a single interior “thru street” and separate cul-de-sac.

MONTERRA PHASE 2 44









Index Address Municipality Region Property Type Site Area Ac Sale Date Sale Price Sale Rate1351 343 Town Line Barrie Simcoe Land 31.01 1-May-14 $3,109,210 $100,2651364 2572 10th Sideroad Bradford West Gwillimbury Simcoe Land 31.09 30-Apr-15 $4,250,000 $136,7003085 260 Mountain Road Collingwood Simcoe Land 48.98 15-Jan-16 $5,850,000 $119,437

Minimum 31.01 1-May-14 $3,109,210 $100,265Maximum 48.98 15-Jan-16 $5,850,000 $136,700Median 31.09 30-Apr-15 $4,250,000 $119,437


MONTERRA PHASE 2 45



MONTERRA PHASE 2 46




ADJUSTMENT ITEMS

Date of Sale Where the market is changing, it may be necessary to adjust prices to reflect the time difference between the dateof sale of a comparable property and the date of valuation.





Site Utility Site utility adjustments take into account site grading, site size, configuration and other factors that may haveimpact upon development. Site grading enhances utility and is considered as a value added feature. As site sizedecreases, certain types of development can become problematic from the standpoint of physical and financialfeasibility. A site size that allows for more flexibility in development is favoured over a smaller more restrictivesite. The configuration of the site will have impact upon maximum usable area of the site. Oddly configured sitestend to have more leakage of usable land.





Index 1351 - 343 Town Line (Barrie) was purchased for $3,109,210 ($100,265 per acre) in 2014-05-01. The propertyrights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale is considered arms-length. Sale of Pine View Golf & Country Club - about 31.0 Ac @ $100,265. For the development of a subdivision ofdetached single family homes. It is currently under construction - Pineview Greens is a new single family homedevelopment By Royalpark Homes. Upward adjustments were made for Sale Date, Development Status and Site Area

MONTERRA PHASE 2 47


Ac. Downward adjustments were made for Location. Adjustments were not required for Property Rights, Financing,Conditions of Sale, Site Utility or Development Density. This sale required a total net upward adjustment - indicating anet adjusted rate of $118,000 per acre.

Index 1364 - 2572 10th Sideroad (Bradford West Gwillimbury) was purchased for $4,250,000 ($136,700 per acre) in2015-04-30. The property rights conveyed were fee simple and financing was reportedly provided by the vendor - thesale is considered arms-length. The site is located across the street from the built-up area of Bradford West Gwillimbury -consisting of new residential development. The farm property is currently leased to a farmer. The purchaser hopes todevelop the property (in 1-3 years) for residential use. Upward adjustments were made for Sale Date, DevelopmentStatus and Site Area Ac. Downward adjustments were made for Location and Site Utility. Adjustments were not requiredfor Property Rights, Financing, Conditions of Sale or Development Density. This sale required a total net upwardadjustment - indicating a net adjusted rate of $150,000 per acre.

Index 3085 - 260 Mountain Road (Collingwood) was purchased for $5,850,000 ($119,437 per acre) in 2016-01-15.The property rights conveyed were fee simple and financing was reportedly provided by the vendor - the sale isconsidered arms-length. This site is located between Mountain Road and Blue Mountain Golf and Country Club. The sitehas frontage along Mountain Road and 10th Line. It is currently an agricultural field. Draft Approved Land inCollingwood's west end allows for a mix of singles, towns, and walk-up units at this time up to 304 units total. Also with acommercial element. Zoned REC EP R3-42 R3 C6. Upward adjustments were made for Sale Date, Development Statusand Site Area Ac. Downward adjustments were made for Site Utility. Adjustments were not required for Property Rights,Financing, Conditions of Sale, Location or Development Density. This sale required a total net upward adjustment -indicating a net adjusted rate of $137,000 per acre.

MONTERRA PHASE 2 48




Property Description Subject Property Index 1351 Index 1364 Index 3085

Address/Legal Description Plateau East 343 Town Line 2572 10th Sideroad 260 Mountain Road

City Town of The Blue Mountains Barrie Bradford West Gwillimbury Collingwood

Sale Date Effective Date 05-01-14 04-30-15 01-15-16

Land Area 16 31 31 49

Sale Price - $3,109,210 $4,250,000 $5,850,000

Sale Rate - $100,265 $136,700 $119,437

Value Adjustments Description Description Adj. Description Adj. Description Adj.

Market Condition (Time) Effective Date 14-05-01 + 15-04-30 + 16-01-15 +

Property Rights Conveyed Fee Simple Fee Simple Nil Fee Simple Nil Fee Simple Nil

Financing Cash Cash Nil VTB Nil VTB Nil

Conditions of Sale Normal Normal Nil Normal Nil Normal Nil

Location Good Good (+) - Good (+) - Good Nil

Site Utility Avg Avg Nil Good - Good -

Development Status Good Good + Avg (+) + Good +

Site Area Ac 16 31.01 + 31.09 + 48.98 +

Total Net Adjustments + + +

Adjusted Rate $118,000.00 $150,000.00 $137,000.00

MONTERRA PHASE 2 49





14.58 acres x $135,000 per acre = $1,968,300

$1,970,000(Rounded)



BOATHOUSE 3&4 50


BOATHOUSE 3&4ADDRESS OF PROPERTY UNDER VALUATION182-184 Jozo Weider Blvd, The Blue Mountains, Grey, Ontario

LEGAL DESCRIPTIONPhase 1 of Grey Standard Condominium Plan No.96 (Mosaic Boathouse at Blue - registered Feb. 28/12, described as Part1, Plan 16R-10135)

PROPERTY IDENTIFICATION NUMBER (PIN)N/A

OWNERSHIP AND HISTORYRecent sales history was not available for Subject Property. There is currently a conditional Agreement of Purchase andSale for the Subject Property. Details were not disclosed.


Vacant commercial development land

PROPOSED USE

Commercial/Retail Buildings (5,000sf)



BOATHOUSE 3&4 51


OFFICIAL PLAN

According to the current Official Plan, the Subject Property is designated Blue Mountain Village Core.

ZONING BY-LAW

According to the current Zoning By-Laws, the Subject Property is designated C5-67-Commercial.

Draft Plan of Condominium Approved as Phased Development. Opportunity to build two commercial buildings up to5,000 square feet of commercial buildings.



Roll Number: Part of 4242000002016823

MPAC Property Code & Description: 105 - Vacant commercial land

Current Value Assessment: NA

VILLAGE RETAIL SPACEThe Subject property is located within the established and well known Blue Mountain Resort located within the Town ofBlue Mountains. The Blue Mountain Resort is well known for all-season activities, including alpine skiing, golfing, cross-country skiing and cycling. The Subject parcel is located at the bottom of the Blue mountain ski hill known as the“Village”.There are approximately 23 units or 53,162 square feet of retail space in the village. As of January 1, 2016, theoccupancy level is 94.1%. The commercial units have access from Jozo Weider Boulevard. The “Village” is a pedestrianfriendly thoroughfare where no cars are allowed.

BOATHOUSE 3&4 52


SITE DESCRIPTION

GENERAL

Location: Blue Mountain Village Core Lands - Fronting Georgian Bay Way


Corner Influence: No Traffic Pattern: Light

Site Area: 0.37 ac. (16,146)

Current Use: Vacant commercial development land.

Proposed Use: Retail buildings

Development Stage: Draft Plan of Condominium Approved as Phased Development

Development Timeline: Immediate

SITE IMAGE

SITE RATING

Utility Rating: Excellent Relatively large retail parcel fronting onto Georgian Way.

Visibility Rating: Excellent Central area of Blue Mountain Village with frontage onto Mill Pond.

Location Rating: Excellent Central area of Blue Mountain Village with frontage onto Mill Pond.

Overall Rating: ExcellentPrime retail location within Blue Mountain Village Area.

BOATHOUSE 3&4 53


DESCRIPTION


Access: Direct access to Georgian Bay Way


Landscaping: The Subject Property is improved with sodding, trees and bushes






Street Lights: Yes Sidewalks: Yes

Curb/Gutter: No Street Surface: NA

Street Width: NA Sewers: Yes

Storms: Yes Ditches: No

Municipal Water: Yes Well: No

Septic: No Hydro: Yes

Gas: Yes Telephone: Yes

Comments:The Subject Property is part of a larger commercial site located within the Blue Mountain Village corearea. The site will support a commercial building of approximately 5,000sf and has exposure onto asmall pond located in the village area.

BOATHOUSE 3&4 54


INCOME APPROACH (LAND RESIDUAL)This is a method of estimating residual value – in this case the value of Subject Lands As-Is. Direct and indirect costs andentrepreneurial profit are deducted from an estimate of the anticipated gross sale price of the complete commercialbuilding. The resultant value represents the value of the Subject Lands As Is.

In order to estimate the Subject Project As Is value using this method, the following steps are performed:

• Market Value of Subject Project As Complete – the market value of the proposed project as complete isestimated using the Income Approach (Direct Capitalization Methodology);

• Building Direct and Indirect Costs - the direct and indirect costs for the subject are estimated;• Entrepreneurial Profit - a reasonable developer’s profit is estimated for the project; and• Land Value – the net resultant value is calculated, representing the current value of the Subject Land.

1. MARKET VALUE OF SUBJECT PROJECT AS COMPLETEThe market value of the subject project as complete is estimated using the Income Approach (Direct CapitalizationMethodology).

The Income Approach is a method of converting the anticipated economic benefits of owning property into a valuethrough the capitalization process. The principle of “anticipation” underlies this approach in that investors recognize therelationship between an asset’s income and its value.

The two most common methods of converting net income into value are the Direct Capitalization Method andDiscounted Cash Flow Method.

• In the Direct Capitalization Method, net operating income is divided by an overall capitalization rate toindicate an opinion of market value.

• In the Discounted Cash Flow Method, anticipated future cash flows and a reversionary value are discounted toan opinion of net present value at a chosen yield rate (internal rate of return). Purchasers acquiring this type ofasset not only look at year one returns, but also consider longer-term strategies.

METHODOLOGY

The Direct Capitalization Method is considered the best methodology by which to develop the Income Approach in thisinstance. A typical investor would consider income in place for this type of property as opposed to a more complicatedcash flow methodology.

REVENUE ANALYSIS

In order to determine an appropriate market rent for the Income Pro forma, a review of market lease transactions wasconducted. The following tables summarize rental activity for retail space in competing buildings within the BlueMountain Village Area.

BOATHOUSE 3&4 55


Current market rents range between $22.00psf and $57.80psf. The “Boat Houses” would provide the best comparisonwith the proposed Subject Building and to that end a rate of $52psf Net would not only be supported by the two BoatHouse rents, but by the other rates presented in the above table.

OPERATING EXPENSES

The retail lease will be written on a fully net basis, with the tenant being responsible for all operating costs.

GENERAL VACANCY & COLLECTION ALLOWANCE

It is our understanding that the village retail space is fully occupied. Based on the assumed term of the lease, the natureof the improvements and marketing time required for space absorption, a stabilized vacancy rate of 2.5% of PotentialGross Income is considered reasonable and selected. No collection loss/bad debt has been factored, as concerns whichan investor may have in this regard would most likely be addressed in the selection of the overall yield.

MANAGEMENT FEE

Typically, a management fee is deducted from the Effective Gross Income. This deductible includes the expenses formanagement. A deduction of 5.0% is considered reasonable and is factored into the analysis.

Unit Tenant Name Building SQFT. Current RENT/SF Next Step Up/SF Lease Start Date Lease End Date

BH-1 Kaytoo Boat Houses 2,800 $57.59 $60.10 1-Jul-14 30-Jun-19

BH-2 WildWing Boat Houses 1,654 $45.20 $47.01 1-Jul-09 30-Jun-19

C-10 Glama Gal Tw een Seasons 857 $35.00 $0.00 1-Jun-15 31-May-20

C-11 Go Fish Go Seasons 989 $31.00 $31.50 1-Mar-15 28-Feb-18

C-13 Tw ist Seasons 2,011 $57.80 $60.10 1-Sep-07 31-Dec-16

C-15 Tholos Seasons 2,529 $53.43 $55.58 14-Jun-06 14-Jun-16

C-8 Crock A Doodle Seasons 847 $30.67 $32.00 13-Jul-09 30-Jun-22

C-9a One Tooth Seasons 483 $33.48 $0.00 1-Jul-12 31-Dec-15

C-9b Georgian Christmas Seasons 1,185 $38.00 $0.00 15-Sep-12 31-Dec-17

C-9c Menchies Yogurt Seasons 1,284 $42.00 $0.00 13-Jul-12 31-Dec-22

CB-1a Chuck Burger Seasons 832 $40.00 $40.50 1-Jul-14 30-Jun-19

CB-1b Jack and Maddy Seasons 1,069 $33.00 $34.00 1-Jul-14 30-Jun-19

CB-2 Olde Stanton Store Seasons 1,161 $42.00 $43.26 1-Jul-14 30-Jun-19

D-1 Magnone's Mosaic 2,151 $57.80 $0.00 1-Jan-12 31-Dec-21

D-2 Kikaku Sushi Bar Mosaic 785 $44.50 $0.00 1-Jun-11 31-Dec-15

D-3 Brights Gallery Mosaic 1,308 $36.15 $0.00 1-Apr-08 31-Dec-17

D-4a Tonia DeBellis Mosaic 604 $35.00 $0.00 1-Nov-14 31-Oct-15

D-5a Sunset Grill Mosaic 1,557 $55.57 $0.00 7-Jun-07 31-Dec-17

D-5b Royal Majesty Mosaic 943 $50.61 $0.00 5-May-08 31-Dec-17

D-7 IWA Spa Mosaic 1,277 $22.00 $0.00 1-Nov-14 31-Oct-25

D-8 North Face Mosaic 2,635 $30.00 $0.00 1-Nov-14 31-Oct-19

H1 Oliver & Bonacini Westin Trillium 4,828 $43.50 $45.24 1-Nov-05 30-Jun-16

Minimum 483 $22.00 $0.00 1-Nov-05 31-Oct-15

Maximum 4,828 $57.80 $60.10 1-Jun-15 31-Oct-25

Average 1,536 $41.56 $20.42 10-Sep-11 16-Jan-19

Comparable Market Leases

BOATHOUSE 3&4 56


INVESTMENT ANALYSIS

As part of our analysis, we reviewed an investment survey published by Altus Insite. Subject to adjustment for geographiclocation/market, it is our opinion that these cap rates better reflect the asset under analysis as opposed to more local yetless “investment grade” properties. The rates presented below provide for a stable benchmark rate for the Torontomarket to which a reasonable adjustment can be made to account for its secondary market location. This surveyindicates that cap rates for single tenant retail properties are in the 5.4% range for Toronto.

Factoring in the Subject Property’s location, market area and quality of asset, a cap rate of 7.40% (200bps above theabove survey rate) appears to be reasonable, given the project and secondary market location.

DIRECT CAPITALIZATION METHOD

INCOME PRO FORMA

The results of the above Revenue and Expense Analysis are summarized in the pro forma presented below.

Total $ PSF

Potential Gross Revenue SF

Boathouse 5,000 $260,000 $52.00

Total Potential Gross Revenue 5,000 $260,000 $52.00

Vacancy and Collection Loss 2.5% $6,500 $1.30

Effective Gross Revenue $253,500 $50.70

Non Recoverable Operating Expenses

Management Expense 5.0% $12,675 $2.54

Total Operating Expenses $12,675 $2.54

Net Operating Income $240,825 $48.17

Income Pro Forma

Twelve months forthcoming

BOATHOUSE 3&4 57


FINAL ESTIMATE OF VALUE

The final estimate of value via the Direct Capitalization Approach is presented in the table below:

Therefore, it is our opinion that the current market value of the Subject Property as improved via the Income Approach,as at 30-June-16 is $3,254,392.

2. BUILDING DIRECT AND INDIRECT COSTSThe building direct and indirect costs are based upon the “Toronto Real Estate Board – Rough/Advanced Guide toConstruction Costs”. Based upon the aforementioned report, a small commercial retail unit is estimated to costapproximately $173psf to construct. Therefore, the cost of construction for a 5,000sf retail building on the SubjectLands is: $173psf x 5,000sf = $867,000

3. ENTREPRENEURIAL PROFITThe ‘Developer’s Profit’ is defined to be that profit earned or anticipated to be earned above costs, from the completionof the project. The estimate reflects the development stage of the subject lands and the market conditions at theeffective date. Although such an allowance for profit is often difficult to substantiate by direct market evidence,discussion with active market participants tend to indicate a range from 15% to 25% for a reasonable return on the riskassociated with developing land. In the subject’s case, the lands are fully zoned with municipal services at the streetcurb and having some existing improvements. The timing and market conditions would suggest a moderate degree ofrisk in developing the lands and selling the completed project. It is concluded that an appropriate allowance in thisinstance would be 25.00% of the gross revenues - the mid-range of the probable scale for developer or entrepreneurialprofit.

The entrepreneurial profit is estimated to be 25% x $3,254,392 = $813,598.

OCR NOI Estimate of Value $psf

6.90% $240,825 $3,490,217 $698

7.15% $240,825 $3,368,182 $674

7.40% $240,825 $3,254,392 $651

7.65% $240,825 $3,148,039 $630

7.90% $240,825 $3,048,418 $610

Direct Capitalization Approach

BOATHOUSE 3&4 58


4. AS IS PROJECT VALUEBased upon the above analysis the residual/land value as at 30-June-16 is estimated to be $1,575,000 (Rounded) or$97psf.

PREVIOUS APPRAISAL DISCLOSURE AND COMMENTSThe Subject Property was appraised for $1,652,000 effective 30-June-15. The current valuation of $1,573,794 containedin this report considers a slightly higher developer profit of 25% as market data is indicating that developers are attainingprofit margins closer to the 25% range as opposed to the 20% percent range. This change in value is consideredreasonable when higher profit margins are factored into this analysis.

Total Rate

Estimated Market Value $3,254,392 $651 psf

Gross Floor Area (sf) 5,000

Land Size (sf) 16,146

Development Costs

Hard and Soft Costs $867,000 $173 psf

Developer's profit $813,598 25.00%

Total Costs $1,680,598

Estimated Residual Land value $1,573,794 $97 psf

Residual Land Value Estimate


VILLAGE CORE LANDS 59


VILLAGE CORE LANDSADDRESS OF PROPERTY UNDER VALUATIONJozo Weider Boulevard/Canning Drive, The Blue Mountains, Grey, Ontario

LEGAL DESCRIPTIONFIRSTLY: Lots 6, 10, 15 and 15 PLAN 1065 and Part Village Crescent PLAN 1065, designated as Parts 1 to 12 PLAN 16R-8744except Grey Standard Condominium Plan No. 65 and Grey Standard Condominium Plan No. 66, Part 1 PLAN 16R-9223,Parts 18-23, PLAN 16R-8762, Parts 7 to 10 and 12 PLAN 16R-8744,, Part 12, PLAN 16R-9223, Part1 PLAN 16R-9266, Part 2PLAN 16R-9223, Grey Standard Condominium Plan No.96 SECONDLY: PIN 37310-0481(LT) Part Lots 14 and 15 and PartVillage Crescent (partly closed by By-law 88-33 Instrument No. R280663, partly closed by By-law 2000-19, InstrumentNo.R422716, and partly closed by By-law 2000-38, Instrument No.R422717) PLAN 1065, designated as Parts 1 to 5 PLAN16R-9197 except Parts 9 to 11, PLAN 16R-9223.

PROPERTY IDENTIFICATION NUMBER (PIN)NA

OWNERSHIP AND HISTORYRecent sales history was not available for Subject Property. There is currently a conditional Agreement of Purchase andSale for part of the Subject Property, dated April 5, 2016 and a purchase price of $4,750,000. The area is estimated to bebetween 3 and 3.5 acres – this would indicate an acreage rate of approximately $1,500,000. The purchaser intends todevelop condo/hotel type units.


Vacant commercial development land

PROPOSED USE

434 Condo Hotel Units, 14 Townhouse Units, 15,000 SF of Commercial Space





OFFICIAL PLAN

According to the current Official Plan, the Subject Property is designated Mountain Village Core.

ZONING BY-LAW

According to the current Zoning By-Laws, the Subject Property is designated C5-67-Commercial and C5-68-Commercial.

Preliminary plans are for 434 condo hotel units and 14 townhouse units plus 15,000 sf of commercial.



Roll Number: Part of 4242000002016823

MPAC Property Code & Description: 105 - Vacant commercial land




SITE DESCRIPTION

GENERAL



Site Area: 10.78 ac. (469,577)

Current Use: Vacant commercial development land.

Proposed Use: 434 Condo Hotel Units 14 Townhouse Units (Total: 448 residential units) and 15,000 SF of CommercialSpace

Development Stage: Draft Plan of Condominium Approved as Phased Development

Development Timeline: Immediate

SITE IMAGE

SITE RATING

Utility Rating: Excellent Large parcel with two road frontages

Visibility Rating: Excellent Central area of Blue Mountain Village with frontage onto Mill Pond.

Location Rating: Excellent Central area of Blue Mountain Village with frontage onto Mill Pond.

Overall Rating: Excellent Prime retail location within Blue Mountain Village Area.



DESCRIPTION

Services Summary: Full Municipal Services Installed

Access: Direct access to Subject Streets


Landscaping: The Subject Property is improved with sodding, trees and bushes






Street Lights: Yes Sidewalks: Yes

Curb/Gutter: Yes Street Surface: Asphalt


Storms: Available Ditches: No




Comments: This property makes up part of the core lands for Blue Mountain Village.



AERIAL VIEW OF VILLAGE




The Subject Lands are zoned commercial and based upon preliminary plans, there are 448 residential units planned, 14of which are to be townhouse type units. In addition, 15,000 square feet of commercial space is also allocated/plannedas part of these lands. For purposes of this valuation, the sale price per residential unit will be used to estimate themarket value of land – this rate will be subsequently adjusted to account for the planned commercial space.

DIRECT COMPARISON APPROACH



In the case of properties similar to the subject, the sale price per residential unit is the most commonly used unit ofcomparison.



The sales selected are considered to provide the most reliable evidence of market value for the Subject Property. Thesearch yielded 5 sales which were considered to be similar to the Subject Property. The sale prices ranged from $950,000to $5,880,000 – a median of $3,250,000. When converted to a sale price per unit, the prices ranged from $18,797 to$42,553 – a median of $25,106.

SaleID Address Municipality Property Type Property Sub Type Site Area Ac Total Site Units Sale Date Sale Price Sale Rate

1229 Madelaine Dr Barrie Land Planned Development (PUD) 3.74 196 14-06-23 $5,880,000 $30,000

1230 85 Sydenham Wells Barrie Land Multi-Family - Townhouse 4.03 94 13-12-19 $4,000,000 $42,553

2076 76,84,90 Ardagh Road Barrie Land Multi-Family - Apartment 1.70 47 13-10-18 $950,000 $20,213

3103 9929-39 Yonge Street Richmond Hill Land Multi-Family - Apartment 0.45 133 16-05-13 $2,500,000 $18,797

Minimum 0.45 47 13-10-18 $950,000 $18,797

Maximum 4.03 196 16-05-13 $5,880,000 $42,553

Median 2.72 114 14-03-22 $3,250,000 $25,106






ADJUSTMENT ITEMS

Date of Sale Where the market is changing, it may be necessary to adjust prices to reflect the time difference between the dateof sale of a comparable property and the date of valuation.





Unit Count Large projects generally take longer to absorb and are subject to greater risk. Adjustments are considered forprojects which vary in proposed size in terms of planned units.

Unit Type Townhouses on a unit basis are typically more valuable as compared to apartment units. Adjustments areconsidered for projects which vary unit type mix.



Index 1229 - Madelaine Dr (Barrie) was purchased for $5,880,000 ($30,000 per unit ) in 2014-06-23. The propertyrights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale is considered arms-length. This sale is located in the south east section of Barrie - an established residential area. It is approved for thedevelopment of 196 residential units (Townhomes, Stacked Townhomes and Condo Apartments). Adjustments were notrequired for Property Rights, Financing, Conditions of Sale or Other. This sale required a total net downward adjustment- indicating a net adjusted rate of $22,000 per unit.

Index 1230 - 85 Sydenham Wells (Barrie) was purchased for $4,000,000 ($42,553 per unit) in 2013-12-19. Theproperty rights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale isconsidered arms-length. This sale is an infill lot in an established residential area, south of Georgian Drive and on thewest side of Penetanguishene Road. The site plan approves for 94 stacked townhomes in a 3 storey building.



Construction beginning in 2014. Upward adjustments were made for Sale Date. Downward adjustments were made forLocation, Unit Count and Unit Type. Adjustments were not required for Property Rights, Financing, Conditions of Sale orOther. This sale required a total net downward adjustment - indicating a net adjusted rate of $24,500 per unit.

Index 2076 - 76,84,90 Ardagh Road (Barrie) was purchased for $950,000 ($20,212 per unit ) in 2013-10-18. Theproperty rights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale isconsidered arms-length. Upward adjustments were made for Sale Date and Location. Downward adjustments weremade for Unit Count. Adjustments were not required for Property Rights, Financing, Conditions of Sale, Unit Type orOther. This sale required a total net upward adjustment - indicating a net adjusted rate of $23,500 per unit.

Index 3103 - 9929-39 Yonge Street (Richmond Hill) was purchased for $2,500,000 ($18,797 per unit ) in 2016-05-13.The property rights conveyed were fee simple and no financing was reportedly provided by the vendor - the sale isconsidered arms-length. Upward adjustments were made for Sale Date. Downward adjustments were made for Locationand Unit Count. Adjustments were not required for Property Rights, Financing, Conditions of Sale, Unit Type or Other.This sale required a total net downward adjustment - indicating a net adjusted rate of $17,000 per unit

.



Adjustment Summary TableProperty Description Subject Property Index 1229 Index 1903-05-14 Index 1905-09-06 Index 1908-06-29Address/Legal Description Blue Mountains Madelaine Dr 85 Sydenham Wells 76,84,90 Ardagh Road 9929-39 Yonge StreetCity Collingwood Barrie Barrie Barrie Richmond HillSale Date Effective Date 06-23-14 12-19-13 10-18-13 05-13-16Land Area 11.00 3.74 4.03 1.70 0.45Sale Price $9,766,800 $5,880,000 $4,000,000 $950,000 $2,500,000Sale Rate $21,801 $30,000 $42,553 $20,213 $18,797Value Adjustments Description Description Adj. Description Adj. Description Adj. Description Adj.Market Condition (Time) Effective Date June 23, 2014 + December 19, 2013 + October 18, 2013 + May 13, 2016 +Property Rights Conveyed Fee Simple Fee Simple Nil Fee Simple Nil Fee Simple Nil Fee Simple NilFinancing Cash Cash Nil Cash Nil Cash Nil Cash NilConditions of Sale Normal Normal Nil Normal Nil Normal Nil Normal NilLocation Avg(+) Good - Good - Avg + Good -Unit Count 448 196 - 94 - 47 - 133 -Unit Type Apt, TH TH, Apt - TH - Apt Nil Apt NilTotal Net Adjustments - - + -Adjusted Rate $22,000.00 $24,500.00 $23,500.00 $17,000.00




Before the adjustment process, the sale prices ranged from $950,000 to $5,880,000 – a median of $3,250,000. Whenconverted to a sale price per unit, the prices ranged from $18,797 to $42,553 – a median of $25,106. After the adjustmentprocess, the unit rates ranged from $17,000 to $24,500 – a median of $23,250. While the sales are not located in theimmediate market area, these sales are considered the best estimators of market value for the Subject Property. Similarto the subject lands, they are located in markets that have a demonstrated demand for higher density housing. With theexception of the subject project there are no other similar high density transactions in the immediate market area. Allfactors considered it is our opinion that the market value of the Subject Property via the Direct Comparison Approach asat 30-June-16, is:

$20,000 per unit x 448 units = $8,960,000

COMMERCIAL COMPONENT – “VALUE ADD”

As mentioned earlier in this section, the commercial component represents a value addition to the residential rate of$20,000 per unit. In order to estimate a reasonable value for the commercial component, reference is made to theprevious “Boathouse 3 & 4” valuation exercise and the valuation model presented therein. A similar exercise is suggestedfor this calculation as it will incorporate the rental potential and hence value potential of this commercial space. In thisinstance and size of the space is changed to 15,000sf and the rental rate is adjusted downward to account for the lesspremium location this space may accommodate as compared to the Boathouse locations. A rental rate between $25psfand $30psf – say $27.50psf would appear to be reasonable – this rate is between the average rate and a rate well belowthe maximum of surveyed lease rates for the village area.

Based upon these factors, it is estimated that the commercial component contributes an additional $1,270,000 (seeAddendum for model details and calculations).



$8,960,000 + $1,270,000 = $10,230,000

The current value estimate of $948,980 per acre for 10.78 acres is considered consistent with the current agreement ofpurchase and sale price of approximately $1,500,000. The aforementioned agreement includes only 3 to 3.5 acres ofland, thereby increasing the acreage rate when compared to a much larger parcel.


The Subject Property was appraised for $6,200,000 effective 30-June-15. The current valuation of $10,230,000 ($948,980per acre) contained in this report implies a percentage increase of approximately 65%. In prior years, it was deemed thata commercial land rate was a more balanced and reliable estimate of market value for the Subject Property. With therecent and significant increase in residential demand for the Collingwood market - including multi residential - avaluation model more focused on multi-residential development is warranted. This is underscored with the currentaccepted agreement of purchase and sale for part of the subject property - for approximately $1,500,000 per acre. Thepurchaser in this instance, plans a townhouse project.

MOUNTAIN WALK II 70


MOUNTAIN WALK IIADDRESS OF PROPERTY UNDER VALUATIONJozo Weider Boulevard/ Wintergreen Place, The Blue Mountains, Grey, Ontario

LEGAL DESCRIPTIONPIN 37310-0186(LT) Parts of Lot 1, Registered Plan 1065, designated as Parts 4, 5 and 6, Plan 16R-3456




373100186 15-April-13 Transfer - T Intrawest Corporation Skyline Blue Mountain Development Inc.


Parking Lot

PROPOSED USE

Undetermined

EASEMENTSWe do not know of any easements that would adversely affect the site's use. If the reader has specific concerns or desiresadditional support, we recommend a title search and consultation with a real estate attorney to determine whether anyadverse conditions exist.


OFFICIAL PLAN

According to the current Official Plan, the Subject Property is designated Medium Density Residential.

ZONING BY-LAW

According to the current Zoning By-Laws, the Subject Property is designated R8-208-Residential.

MOUNTAIN WALK II 71


Presently used for parking (Can only be developed if replacement parking is provided elsewhere on the resort.)



Roll Number: 424200000316700



MOUNTAIN WALK II 72


SITE DESCRIPTION

GENERAL

Location: Jozo Weider Boulevard/ Wintergreen Place



Site Area: 4.46 ac. (194,278)

Current Use: Village overflow parking.

Proposed Use: Medium Density Residential

Development Stage: Plan of Condominium Required

Development Timeline: Undefined.

SITE IMAGE

SITE RATING

Utility Rating: Good Rectangular site with onsite parking

Location Rating: Good In close proximity to Blue Mountain Village and all recreationalamenities.

Overall Rating: Good Attractive residential development given it locational and physicalattributes.

MOUNTAIN WALK II 73


DESCRIPTION

Services Summary: Full Municipal Services Installed



Landscaping: None






Street Lights: Yes Sidewalks: No

Curb/Gutter: No Street Surface: Asphalt


Storms: Available Ditches: No




Comments: The site is used for exclusively for parking.

MOUNTAIN WALK II 74


VALUATION ESTIMATEINTRODUCTION

This property is currently used for Village overflow parking and it is our understanding that it is subject to a titlerestriction in an agreement with Blue Mountain Resorts. Development of this site can only occur if an alternativesite or costly underground/above ground parkade can be attained. An above ground parkade is estimated tocost approximately $20,000 per spot ($6,000,000 for 300 spots), while underground parking is estimated to cost$30,000 per spot ($9,000,000 for 300 spots). Furthermore, it was determined that paid parking at this point intime would not be an option - as it would not be acceptable to all parties with interest in the resort.

VALUE ESTIMATE

The site is zoned for 26 attached multiple residential units and reflects a density of 5.83 units per acre. However,the only way to extract value from this site in the short-term is to replace parking elsewhere within the resort.

MEDIUM DENSITY VALUE ESTIMATE

A search of medium density sales was conducted in the subject market area. Four sales were considered toprovide the most reliable evidence of market value for the Subject Property. The search yielded 4 sales whichwere considered to be similar to the Subject Property. The sale prices ranged from $714,000 to $2,000,000.When converted to a sale price per Site AC, the prices ranged from $44,625 per unit to $67,000 per unit.

(See Addendum for sales details)

The immediate subject area is considered a premium market area and for that reason, all the sales requiredupward adjustments for location except Index 3097. Upward time adjustments at different degrees were alsoconsidered for the all the sales. Given the immediate proximity of Index 3097, it is considered the best sale anddeemed to best represent the potential sale rate for the Subject Property. It is reasonable to conclude that amarket rate for the Subject Lands to be $70,000 per unit. Based upon this rate, the estimated market value ofthe Subject Property under this scenario would be $72,000 x 26 units = $1,872,000.

SPECULATIVE VALUE UNDER DEVELOPMENT RESTRICTIONS

The only market value the Subject Property would have is “speculative value” based upon an assumption thatparking would eventually be found or the utility it provides to the overall resort could be monetized in someother manner – whether through paid parking or special levies to all its stakeholders.

A prudent purchaser would choose at least a 10-year investment time frame for such an investmentproposition. The IRR would need to be approximately 25% (comparable to returns demanded by manyresidential developers in the market) and an inflation rate estimate of 2%.

Index Address Municipality Region Property Type Total Site Units Site Area Ac Sale Date Sale Price Sale Rate1227 3700 Ruthven Crescent New Tecumseth Simcoe Land 27 8.76 4-Feb-15 $1,900,000 $70,3702267 Plan 51M-798 Blocks 7, 9 & 11 Wasaga Beach Simcoe Land 16 1.01 31-Oct-11 $714,000 $44,6252764 Stonemount Crescent Essa Simcoe Land 24 2.49 28-Oct-11 $1,530,000 $63,7503097 171 Snowbridge Way The Blue Mountains Grey Land 28 2.38 2-Feb-16 $2,000,000 $71,429

Minimum 16 1.01 28-Oct-11 $714,000 $44,625Maximum 28 8.76 2-Feb-16 $2,000,000 $71,429

Median 25.5 2.435 18-Jun-13 $1,715,000 $67,060


MOUNTAIN WALK II 75


Based upon the above parameters, the Subject Lands would have a terminal value of $2,193,346 (10 yearshence) and a present value of $240,219.

Based upon the above scenario, the market value of the Subject Property as at 30-June-16, is:

$240,000 (Rounded)


The Subject Property was appraised for $234,000 effective 30-June-15. The current valuation of $240,000contained in this report implies a percentage increase of 2.5%. Given the nature of the lands, a marginalincrease of 2.5% would appear reasonable.

CERTIFICATION OF APPRAISAL 76


CERTIFICATION OF APPRAISAL• I certify to the best of my knowledge and belief that:• The statements of fact contained in this report are true and correct;• The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting

conditions, and are my personal, impartial and unbiased professional analyses, opinions and conclusions;• I have no present or prospective interest in the property that is the subject of this report, and no personal interest

with respect to the parties involved;• I have no bias with respect to the property that is the subject of this report or to the parties involved with this

assignment;• My engagement in and compensation for this assignment were not contingent upon developing or reporting

predetermined results, the amount of the value estimate, or a conclusion favouring the client;• My analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the

Canadian Uniform Standards;• I have the knowledge and experience to complete the assignment competently;• No one provided significant professional assistance to the person signing this report;• As of the date of this report, the undersigned has fulfilled the requirements of The Appraisal Institute of Canada

Continuing Professional Development Program for Members;• The undersigned is a member in good standing of the Appraisal Institute of Canada.• I did personally inspect the Subject Property of the report;

FINAL VALUE ESTIMATEHaving regard to all the information contained in this report, it is my opinion that the market value of the Subject Property,as at 30-June-16 is:



No. Property Estimated Market value

1 Monterra South/Second Nature (South & North Half) $10,815,000

2 Plateau East $2,170,000

3 Monterra Phase 2 $1,970,000

4 Boathouse 3 and 4 Lands $1,575,000

5 Village Core Lands $10,230,000

6 Mountain Walk II $240,000

Total $27,000,000

BLUE MOUNTAIN RESORT DEVELOPMENT LANDS

Toivo

Toivo Heinsaar Signature

ADDENDUM 77


ADDENDUMA - Assumptions and Limiting Conditions

B – Subject Property Images & Documents

C – Comparable Sales

D – Commercial Space Calculation

E - Appraiser CV

ADDENDUM A


ASSUMPTIONS AND LIMITING CONDITIONS

ADDENDUM A


ASSUMPTIONS AND LIMITING CONDITIONS• The Report has been made subject to the following assumptions and limiting conditions:• This report has been prepared at the request of Mr. Vadim Shub, Skyline Investment Inc. The purpose of

this appraisal is to estimate the market value of the Subject Properties. It is not reasonable for anyperson other than the person or those to whom this report is addressed to rely upon this appraisalwithout first obtaining written authorization from Mr. Vadim Shub, Skyline International DevelopmentInc and the author of this report. This report has been prepared on the assumption that no other personwill rely on it for any other purpose and all liability to all such persons is denied.

• This report has been prepared at the request of Mr. Vadim Shub, Skyline International Development Incand for the exclusive (and confidential) use of the recipients as named herein and for the specificpurpose and function as stated herein. All copyright is reserved to the author and this report isconsidered confidential by the author and Mr. Vadim Shub, Skyline Investment Inc. Possession of thisreport, or a copy thereof, does not carry with it the right to reproduction or publication in any manner,in whole or in part, nor may it be disclosed, quoted from or referred to in any manner, in whole or inpart, without the prior written consent and approval of the author as to the purpose, form and contentof any such disclosure, quotation or reference.

• Without limiting the generality of the foregoing, neither all nor any part of the contents of this reportshall be disseminated or otherwise conveyed to the public in any manner whatsoever or through anymedia whatsoever or disclosed, quoted from or referred to in any report, financial statement,prospectus, or offering memorandum of the client, or in any documents filed with any governmentalagency without the prior written consent and approval of the author as to the purpose, form andcontent of such dissemination, disclosure, quotation or reference.

• The estimated market value of the real property which is appraised in this report pertains to the valueof the Fee Simple interest in the real property. The property rights appraised herein exclude mineralrights, if any.

• The estimate of value contained in this report is founded upon a thorough and diligent examination andanalysis of information gathered and obtained from numerous sources. Certain information has beenaccepted at face value; especially if there was no reason to doubt its accuracy. Other empirical datarequired interpretive analysis pursuant to the objective of this appraisal. Certain inquiries were outsidethe scope of this mandate.

• The Subject Properties has been valued on the basis that title to the real property herein appraised isgood and marketable.

• The author of this report cannot accept responsibility for legal matters, questions of survey, opinions oftitle, hidden or unapparent conditions of the property, toxic wastes or contaminated materials, soil orsub-soil conditions, environmental, engineering or other technical matters which might render thisproperty more or less valuable than as stated herein. If it came to our attention as the result of ourinvestigation and analysis that certain problems may exist, a cautionary note has been entered in thebody of the report.

• The legal description of the property and the area of the site were obtained from TeranetGeowarehouse and/or MPAC ICI Industrial Report. Further, the plans and sketches contained in thisreport are included solely to aid the recipient in visualizing the location of the property, theconfiguration and boundaries of the site and the relative position of the improvements on the saidlands.

• The Subject Properties has been valued on the basis that the real property is free and clear of all valueinfluencing encumbrances, encroachments, restrictions or covenants except as any be noted in this

ADDENDUM A


report and that there are no pledges, charges, lien or social assessments outstanding against theproperty other than as stated and described herein.

• The Subject Properties has been valued on the basis that there are no outstanding liabilities except asexpressly noted herein, pursuant to any agreement with a municipal or other government authority,pursuant to any contract or agreement pertaining to the ownership and operation of the real estate orpursuant to any lease or agreement to lease, which may affect the stated value or saleability of TheSubject Properties or any portion thereof.

• The interpretation of leases (if any) or other contractual agreements, pertaining to the operation andownership of the property, as expressed herein, is solely the opinion of the author and should not beconstrued as a legal interpretation.

• The Subject Properties has been valued on the basis that the real property complies in all materialrespects with any restrictive covenants affecting the site and has been built and is occupied and beingoperated, in all material respects, in full compliance with all requirements of law, including all zoning,land use classification, building, planning, fire and health by-laws, rules, regulations, orders and codesof all federal, provincial, regional and municipal governmental authorities having jurisdiction withrespect thereto.

• It is recognized there may be work orders or other notices of violation of law outstanding with respectto The Subject Properties and that there may be certain requirements of law preventing occupancy ofthe real estate as described in this report. However, such possible circumstances have not beenaccounted for in the appraisal process.

• Investigations have been undertaken in respect of matters which regulate the use of land. However, noinquiries have been placed with the fire department, the building inspector, the health department orany other government regulatory agency, unless such investigations are expressly represented to havebeen made in this report. The Subject Properties must comply with such regulations and, if it does notcomply, its non-compliance may affect its market value. To be certain of such compliance, furtherinvestigations may be necessary.

• The data and statistical information contained herein were gathered from reliable sources and arebelieved to be correct. However, these data are not guaranteed for accuracy, even though everyattempt has been made to verify the authenticity of this information as much as possible.

• The estimated market value of The Subject Properties does not necessarily represent the value of theunderlying shares, if the asset is so held, as the value of the shares could be affected by otherconsiderations. Further, the estimated market value does not include consideration of anyextraordinary market value of the property, unless the effects of such special conditions, and the extentof any special value that may arise there from, have been described and measured in this report.

• Should title to The Subject Properties presently be held (or changed to a holding) by a partnership, in ajoint venture, through a co-tenancy arrangement or by any other form of divisional ownership, thevalue of any fractional interest associated therewith may be more or less than the percentage ofownership appearing in the contractual agreement pertaining to the structure of such divisionalownership.

• In the event of syndication, the aggregate value of the limited partnership interests may be greater thanthe value of the Fee Simple interest in the real property, by reason of the possible contributory value ofnon-realty interests or benefits such as provision for tax shelter, potential for capital appreciation,special investment privileges, particular occupancy and income guarantees, special financing orextraordinary agreements for management services.

• Should the author of this report be required to give testimony or appear in court or at anyadministrative proceeding relating to this appraisal, prior arrangements shall be made therefore,

ADDENDUM A


including provisions for additional compensation to permit adequate time for preparation and for anyappearances which may be required. However, neither this or any other of these contingent or limitingconditions is an attempt to limit the use that might be made of this report should it properly becomeevidence in a judicial proceeding. In such a case, it is acknowledged that it is the judicial body which willdecide the use of this report which best serves the administration of justice.

• Because market conditions, including economic, social and political factors, change rapidly and, onoccasion, without notice or warning, the estimate of market value expressed herein, as of the effectivedate of this appraisal, cannot necessarily be relied upon as any other date without subsequent advice ofthe author of this report.

• The value expressed herein is in Canadian dollars.• This report is only valid if it bears the original signature(s) of the author(s).

ADDENDUM B


SUBJECT PROPERTY IMAGES & DOCUMENTS

ADDENDUM C


COMPARABLE SALES

Madelaine Dr , BarrieIndex: 1229 Land

CVA $1,755,085

PIN 587371074

Roll No. 434205000620350

Property Code 112

Multi-residential vacant landDescription

Vendor

Purchaser

3251586 Canada Inc

Pratt Hansen Group

Address Madelaine Dr

Municipality Barrie

Region Simcoe

Location Madelaine Dr and Yonge St

This sale is located in the south east section of Barrie. It is approved for the development of 196 residential units (Townhomes, StackedTownhomes and Condo Apartments).

Site Area $/ac

Site Area $/sf $36.09

$1,572,193

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot $30,000

Buildable $/ft ?

Sale Date 2014-06-23

Cash Price

Assumed Price

$5,880,000

$0

VTB $0

Other

Chattels

$0

$0

Total Price $5,880,000

% Transferred 100%

Sale Price $5,880,000

3.74ac (162,914.40sf)Site Area

Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

196.00No of Lots

Planned Development (PUD)

85 Sydenham Wells , BarrieIndex: 1230 Land

CVA

PIN 588311813

Roll No. 4342011023001620

Property Code 112


Vendor

Purchaser

2293420 Ontario Inc

Fernwood developments (ontario)

Address 85 Sydenham Wells

Municipality Barrie

Region Simcoe

Location Cheltenham Rd and Penetanguishene Rd

This sale is an infill lot, south of Georgian Drive and on the west side of Penetanguishene Road. The site plan approves for 94 stackedtownhomes in a 3 storey building. Construction begining in 2014 MarshallZehr Group Inc principal: $15,000,000 rate: Tranche 1:$3,400,000 to purchase properties. 8.0% per annum, due 4/18/2014. Tranche 2: $13,750,000 to develop properties. 12.0% per annum,due 12/18/2015. registered: 12/19/2013 due: 01/01/2016

Site Area $/ac


$992,556

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot $42,553

Buildable $/ft ?


Cash Price

Assumed Price

$600,000

$3,400,000

VTB $0

Other

Chattels

$0

$0


% Transferred 100%



Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

94.00No of Lots

Multi-Family - Townhouse

3278 4th Line , Bradford West GwillimburyIndex: 1349 Land

CVA $790

PIN 580050060

Roll No. 431202000500800

Property Code 260

Vacant residential/commercial/ industrial land owned by a non-farmer with a portion being farmedDescription

Vendor

Purchaser

Bradford 4th Line Ontario Inc 905-264-5565Highcastle HomesRomolo Margarelli 905-335-3700

Address 3278 4th Line

Municipality Bradford West Gwillimbury

Region Simcoe

Location

This sale represents a farm and future development land. It is located just east of Highway 400 and north of the Holland Marsh. Thisproperty was purchased together with 3203 Fifth Line (91.1 acres) for a total consideration of $16,500,000

Site Area $/ac


$80,409

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot ?

Buildable $/ft ?


Cash Price

Assumed Price

$8,250,000

$0

VTB $0

Other

Chattels

$0

$0


% Transferred 100%


102.60ac (4,469,256.00sf)Site Area

Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

No of Lots

Subdivision-Residential

2944 5th Line , Bradford West GwillimburyIndex: 1350 Land

CVA $939,000

PIN 58012008

Roll No. 43 11 020 005 05300

Property Code 261

Land owned by a non-farmer improved with a non-farm residence with a portion being farmedDescription

Vendor

Purchaser

Porta Holdings Ltd 416-236-9474Imperra General ManagementGB (Bradford) Inc 905-849-1360Melrose Investments Inc

Address 2944 5th Line


Region Simcoe

Location

This farm and future development land is located on the north side of 5th Line and adjacent to the Highlands Golf Club and residentialdevelopment along Brownlee Drive. It is also a short distance south east of the Highway 400 interchange at County Road 88. It was lasttransferred in December 2010 for $6,600,000 principal: $5,000,000 rate: 5.0% per annum.registered: 08/07/2014 due: on demand

Site Area $/ac


$99,761

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot ?

Buildable $/ft ?


Cash Price

Assumed Price

$5,000,000

$5,000,000

VTB $0

Other

Chattels

$0

$0


% Transferred 100%


100.24ac (4,366,454.40sf)Site Area

Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

No of Lots


343 Town Line , BarrieIndex: 1351 Land

CVA $2,915,000

PIN 589110017

Roll No. 434204001703100

Property Code 125

Residential development landDescription

Vendor

Purchaser

Pine View Golf and Country Club Inc 416-224-9968Morrison and PayneSummitpines Estates Inc 905-850-7144

Address 343 Town Line

Municipality Barrie

Region Simcoe

Location

Sale of Pine View Golf & Country Club - about 31.0 Ac @ $100,265 For development of a subdivision of detached single family homes.It is currently under construction - Pineview Greens is a new single family home development By Royalpark Homes.

Site Area $/ac


$100,265

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot ?

Buildable $/ft ?


Cash Price

Assumed Price

$3,109,210

$0

VTB $0

Other

Chattels

$0

$0


% Transferred 100%


31.01ac (1,350,795.60sf)Site Area

Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

No of Lots

Residential (Single-Family)

2572 10th Sideroad , Bradford West GwillimburyIndex: 1364 Land

CVA $296,000

PIN 580040022

Roll No. 431202000513100

Property Code 260


Vendor

Purchaser

Named Individual(s)Oldton Developments Inc 905-670-7898Calton Developments

Address 2572 10th Sideroad


Region Simcoe

Location

The site is located across the street from the built-up area of Bradford West Gwillimbury - consisting of new residential development. Thefarm property is currently leased to a farmer. The purchaser hopes to develop the property (in 1-3 years) for residential use. NamedIndividual(s)principal: $2,125,000 rate: 4.5% per annum.registered: 04/30/2014 due: 04/30/2019

Site Area $/ac


$136,700

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot ?

Buildable $/ft ?


Cash Price

Assumed Price

$2,125,000

$0

VTB $2,125,000

Other

Chattels

$0

$0


% Transferred 100%


31.09ac (1,354,280.40sf)Site Area

Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

No of Lots


76,84,90 Ardagh Road , BarrieIndex: 2076 Land

CVA $732,000

PIN 587600460,74

Roll No. 434204000600880

Property Code 112


Vendor

Purchaser

2251914OntarioInc

JRSelectHoldingsInc

Address 76,84,90 Ardagh Road

Municipality Barrie

Region Simcoe

Location

Approved for the development of a 3 storey,47unit rental apartment building.

Site Area $/ac


$558,824

Bldg Area $/sf ?

Frontage $/ft $3,058

$/ Suite ?

$ / Lot $20,213

Buildable $/ft ?


Cash Price

Assumed Price

$950,000

$0

VTB $0

Other

Chattels

$0

Total Price $950,000

% Transferred 100%

Sale Price $950,000

1.70ac (74,052.00sf)

310.66

Site Area

Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

47.00No of Lots

Multi-Family - Apartment

260 Mountain Road , CollingwoodIndex: 3085 Land

CVA $260,000

PIN 582540199

Roll No. 433108001207800

Property Code 260


Vendor

Purchaser

2028170 Ontario Inc

Maid Mills Village Inc

Address 260 Mountain Road

Municipality Collingwood

Region Simcoe

Location

This site is located between Mountain Road and Blue Mountain Golf and Country Club. The site has frontage along Mountain Road and10th Line. It is currently an agricultural field. Draft Approved Land in Collingwood's west end allows for a mix of singles, towns, and walk-up units at this time up to 304 units total. Also with a commercial element. Zoned REC EP R3-42 R3 C6. 2038170 Ontario Incprincipal: $4,350,000 rate: TD prime plus 2.0% per annum.registered: 01/15/2016 due: on demand

Site Area $/ac


$119,437

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot ?

Buildable $/ft ?


Cash Price

Assumed Price

$1,500,000

$4,350,000

VTB $0

Other

Chattels

$0

$0


% Transferred 100%


48.98ac (2,133,568.80sf)Site Area

Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

No of Lots

Residential (Single-Family)

9929-39 Yonge Street , Richmond HillIndex: 3103 Land

CVA

PIN 031400009

Roll No. 19380300107400

Property Code

Description

Vendor

Purchaser

Great Land (Elmwood) Inc

Metroview Developments (Elmwood) Inc

Address 9929-39 Yonge Street

Municipality Richmond Hill

Region York

Location

Proposed development of a 15-storey, 133 suite residential condo building (not yet approved).

Site Area $/ac


$5,555,556

Bldg Area $/sf ?

Frontage $/ft ?

$/ Suite ?

$ / Lot $18,797

Buildable $/ft ?


Cash Price

Assumed Price

$2,500,000

$0

VTB $0

Other

Chattels

$0

$0


% Transferred 100%



Frontage (ft)

Building (sf)

Buildable (sf)

No of Suites

133.00No of Lots

Multi-Family - Apartment

ADDENDUM D


COMMERCIAL COMPONENT – “VALUE ADD”INCOME APPROACH (LAND RESIDUAL)This is a method of estimating residual value – in this case the value of Subject Lands As-Is. Direct and indirectcosts and entrepreneurial profit are deducted from an estimate of the anticipated gross sale price of thecomplete commercial building. The resultant value represents the value of the Subject Lands As Is.

In order to estimate the Subject Project As Is value using this method, the following steps are performed:

• Market Value of Subject Project As Complete – the market value of the proposed project as completeis estimated using the Income Approach (Direct Capitalization Methodology);

• Building Direct and Indirect Costs - the direct and indirect costs for the subject are estimated;• Entrepreneurial Profit - a reasonable developer’s profit is estimated for the project; and• Land Value – the net resultant value is calculated, representing the current value of the Subject Land.

MARKET VALUE OF SUBJECT PROJECT AS COMPLETE

The market value of the subject project as complete is estimated using the Income Approach (DirectCapitalization Methodology).

The Income Approach is a method of converting the anticipated economic benefits of owning property into avalue through the capitalization process. The principle of “anticipation” underlies this approach in thatinvestors recognize the relationship between an asset’s income and its value.

The two most common methods of converting net income into value are the Direct Capitalization Method andDiscounted Cash Flow Method.

• In the Direct Capitalization Method, net operating income is divided by an overall capitalization rateto indicate an opinion of market value.

• In the Discounted Cash Flow Method, anticipated future cash flows and a reversionary value arediscounted to an opinion of net present value at a chosen yield rate (internal rate of return). Purchasersacquiring this type of asset not only look at year one returns, but also consider longer-term strategies.

METHODOLOGY

The Direct Capitalization Method is considered the best methodology by which to develop the Income Approachin this instance. A typical investor would consider income in place for this type of property as opposed to a morecomplicated cash flow methodology.

REVENUE ANALYSIS

In order to determine an appropriate market rent for the Income Pro forma, a review of market leasetransactions was conducted. The following tables summarize rental activity for retail space in competingbuildings within the Blue Mountain Village Area.

ADDENDUM D


Current market rents range between $22.00psf and $57.80psf. Commercial space for these lands would beexpected to fall well below the rates attained by the boathouse. This space would be somewhat less “central”and a rental rate between $25psf and $30psf – say $27.50psf would appear to be reasonable – this rate isbetween the average rate and a rate well below the maximum of surveyed lease rates for the village area.

OPERATING EXPENSES

The retail lease will be written on a fully net basis, with the tenant being responsible for all operating costs.

GENERAL VACANCY & COLLECTION ALLOWANCE

It is our understanding that the village retail space is fully occupied. Based on the assumed term of the lease,the nature of the improvements and marketing time required for space absorption, a stabilized vacancy rate of2.5% of Potential Gross Income is considered reasonable and selected. No collection loss/bad debt has beenfactored, as concerns which an investor may have in this regard would most likely be addressed in the selectionof the overall yield.

ADDENDUM D


MANAGEMENT FEE

Typically, a management fee is deducted from the Effective Gross Income. This deductible includes the expensesfor management. A deduction of 5.0% is considered reasonable and is factored into the analysis.

INVESTMENT ANALYSIS

As part of our analysis, we reviewed an investment survey published by Altus Insite. Subject to adjustment forgeographic location/market, it is our opinion that these cap rates better reflect the asset under analysis asopposed to more local yet less “investment grade” properties. The rates presented below provide for a stablebenchmark rate for the Toronto market to which a reasonable adjustment can be made to account for itssecondary market location. This survey indicates that cap rates for single tenant retail properties are in the 5.4%range for Toronto.

Factoring in the Subject Property’s location, market area and quality of asset, a cap rate of 7.40% (200bps abovethe above survey rate) appears to be reasonable, given the project and secondary market location.

DIRECT CAPITALIZATION METHOD

INCOME PRO FORMA

The results of the above Revenue and Expense Analysis are summarized in the pro forma presented below.

ADDENDUM D


FINAL ESTIMATE OF VALUE

The final estimate of value via the Direct Capitalization Approach is presented in the table below:

Therefore, it is our opinion that the current market value of the Subject Property as improved via the IncomeApproach, as at 30-June-16 is $5,163,218.

BUILDING DIRECT AND INDIRECT COSTS

The building direct and indirect costs are based upon the “Toronto Real Estate Board – Rough/Advanced Guideto Construction Costs”. Based upon the aforementioned report, a small commercial retail unit is estimated tocost approximately $173psf to construct. Therefore, the cost of construction for a 5,000sf retail building on theSubject Lands is: $173psf x 15,000sf = $2,601,000

ENTREPRENEURIAL PROFIT

The ‘Developer’s Profit’ is defined to be that profit earned or anticipated to be earned above costs, from thecompletion of the project. The estimate reflects the development stage of the subject lands and the marketconditions at the effective date. Although such an allowance for profit is often difficult to substantiate by directmarket evidence, discussion with active market participants tend to indicate a range from 15% to 25% for areasonable return on the risk associated with developing land. In the subject’s case, the lands are fully zonedwith municipal services at the street curb and having some existing improvements. The timing and marketconditions would suggest a moderate degree of risk in developing the lands and selling the completed project. Itis concluded that an appropriate allowance in this instance would be 25.00% of the gross revenues - the mid-range of the probable scale for developer or entrepreneurial profit.

The entrepreneurial profit is estimated to be 25% x $5,163,218 = $1,290,804.

Total $ PSF

Potential Gross Revenue SF

Boathouse 15,000 $412,500 $27.50

Total Potential Gross Revenue 15,000 $412,500 $27.50

Vacancy and Collection Loss 2.5% $10,313 $0.69

Effective Gross Revenue $402,188 $26.81

Non Recoverable Operating Expenses

Management Expense 5.0% $20,109 $1.34

Total Operating Expenses $20,109 $1.34

Net Operating Income $382,078 $25.47

Income Pro Forma


OCR NOI Estimate of Value $psf

6.90% $382,078 $5,537,364 $369

7.15% $382,078 $5,343,750 $356

7.40% $382,078 $5,163,218 $344

7.65% $382,078 $4,994,485 $333

7.90% $382,078 $4,836,432 $322

Direct Capitalization Approach

ADDENDUM D


RESIDUAL VALUE

Based upon the above analysis the value add component of the commercial land as at 30-June-16 is estimatedto be $1,270,000 (Rounded).

Total Rate

Estimated Market Value $5,163,218 $344 psf

Gross Floor Area (sf) 15,000

Development Costs

Hard and Sof t Costs $2,601,000 $173 psf

Developer's profit $1,290,804 25.00%

Total Costs $3,891,804

Estimated Residual Land value $1,271,413

Residual Land Value Estimate


ADDENDUM E


APPRAISER CV

5859 Yonge Street, Suite 104Toronto, ON M2M 3V6Canada

D. 647.749.9319 Ext. [email protected]

Toivo Heinsaar BA, AACI, P.App., MRICS

Partner

Education and QualificationsBachelor of Arts, Honors(Economics Specialist)University of Toronto

Financial Analysis and InvestmentManagement CertificateUniversity of Toronto

Accredited Appraiser Canadian Institute(AACI)Appraisal Institute of Canada

Member of the Royal Institution ofChartered Surveyors (MRICS)Royal Institution of Chartered Surveyors

BrokerOntario Real Estate Association

Area of ExpertiseReal Estate Valuation and Advisory

Professional ExperienceSenior Vice President, Valuation & AdvisoryAvison Young

Director, Real Estate ValuationDeloitte & Touché LLP

Vice-President, Valuation & Advisory ServicesCushman & Wakefield Inc.

Associate Vice-PresidentColliers International Realty Advisors

Senior Appraiser, Forensic & Litigation Support ServicesAmerican Appraisal Canada Inc.

Business BackgroundToivo brings over 20 years of experience in real estate valuation and advisoryservices. His experience ranges from forensic and litigation support services tofinancial reporting for large investment grade assets — for both single asset andlarge geographically dispersed portfolios. His clients include some of the nation’sleading financial and public institutions, real estate developers and investors.

His areas of experience include:

• Single asset valuation

• Portfolio valuation

• Highest and best use analysis

• Appraisal review

• Dispute analysis and litigationsupport

• Transaction support



Professional Accomplishments

Financial Audit SupportValuation review and advisory for many of Canada’s largest real estate investment funds and REITS – including Brookfield,CPPIB and GWL.

Single Asset & Portfolio ValuationOver $2 Billion in value appraised annually across Canada for companies such as: Bentall Kennedy (Canada) LP;Caisse de dépôtet placement du Québec; Standard Life Assurance Company of Canada; Redcliff Realty Advisors; Sears Canada; InterRentREIT; Timbercreek Asset Management Inc.; Manulife Financial; EuroHypo AG; Sun Life Assurance Company of Canada;Strathallen Capital Corporation; Ontario Realty Corporation; PWGSC; Metrolinx; Blackwood Partners; Citigroup; Build Torontoand KingSett Capital.

OfficeProvided valuation services for a large range of office type properties across Canada. Some notable assignments include:Nortel Research Office Campus, Ottawa; Steeles Technology Campus, Toronto; Canada Square, Toronto; University Centre,Toronto; Joseph Howe Centre, Halifax; 121 King Street West, Toronto; and York Mills Centre, Toronto, The Atria, Toronto.

RetailIn addition to providing valuations for smaller scale properties, some larger assignments included: Gerrard Square, Toronto,Sheppard Centre, Toronto; Lloyd Jackson Square, Hamilton; Rainbow Centre, Sudbury; and Peterborough Square,Peterborough.

Special PurposeOf the many special purpose use valuations conducted, some notable assignments include: Rogers Centre, Toronto; Leaseholdvaluation of Priszm Income Fund, Canada; Twin Pad Arena, Kitchener; Hearn Generating Plant, Toronto; Toronto City CentreAirport, Toronto (Hangars & Fuel Farm); and Sudbury Community Arena, Sudbury.

Land DevelopmentValuation assignments for land have ranged by geography, size and use. Some assignments include: 4,000ac of developmentland across Ontario; Bay Adelaide Centre (151,775sf); 16 York Street, Toronto (122,504sf); 1 Bloor St E, Toronto (871,876sfbuildable); North Oak Park Development, Brantford (336ac); Port Lands, Toronto (18.75ac); Laid Road, Guelph (116.16ac); 45Bay Street, Toronto (1,468,843sf buildable); and Oakville Land Assembly, Oakville (1,160ac).

Multi ResidentialMulti residential assignments are mostly at the portfolio level such as InterRent Reit Portfolio, Ontario and Timbercreek. Singleasset valuations include multiple locations across Ontario.

IndustrialIndustrial valuations have ranged from large business parks in Toronto to cold storage facilities in smaller towns. Some largerassignments include: 256 Rutherford Road South, Brampton (Cross Dock 101,449sf); Matheson Business Park, Mississauga(449,533sf); Oakville Self Storage (102,590sf); Food Processing Plant, Oakville (366,000sf); ING Summit Industrial Fund,Canada; Norelco, Toronto (1,135,017sf); and Sears, Distribution Facility, Belleville (1,804,896sf).

Public PresentationsToivo Heinsaar has spoken on a range of valuation topics pertaining to commercial, industrial and investment properties.Some of his seminars for real estate organizations include the following:



Land Sales Data and DMS Design (2004) - A two-part seminar offering insight into the design of a Database ManagementSystem (DMS) along with a review of the relevant land appraisal methodology. The seminar was co-authored with PaulBender, AACI and sponsored by the Ontario Association – Appraisal Institute of Canada.

Issues Arising from Component Accounting and Property Plant and Equipment (IAS 16) (2009) - Part of a two-day seminarprovided by InfoNex titled “IFRS for Real Estate Understanding Critical Issues Affecting Financial Reporting in the Real EstateIndustry”. This included the discussion of the implications of component accounting for non-investment property orinvestment property where the cost model has been selected.

How to Value in a Recessionary Market – an Appraiser's Perspective (2009) - Part of the 43rd Annual Canadian Property TaxAssociation National Workshop. This included the discussion on challenges and dangers of “Point in Time” valuation and howone values in such a market.

Annual Toronto Office Market Overview (2008-2011) for Caisse de dépôt et placement du Québec - A office market overviewprovided to the Montreal Head Office Real Estate Group.